Govt. Notifies Income Tax Relief To Visakhapatnam Special Economic Zone Authority
Govt. Notifies Income Tax Relief To Visakhapatnam Special Economic Zone Authority
The Central Board of Direct Taxes (CBDT) under the Ministry of Finance has notified an income tax exemption to the Visakhapatnam Special Economic Zone Authority through a notification no. 32/2026, dated March 25, 2026. The notification underlines which types of income will be covered under this exemption and the conditions that must be followed to continue receiving this benefit.
The government has provided the exemption to the said authority under clause (46) of section 10 of the Income Tax Act, 1961. This means that income earned by the authority from specific sources will be tax-free if it fulfils the following conditions:
- Does not carry out any commercial activity.
- The nature of activities and the specified income should remain unchanged during the relevant financial years.
- Files its return of income (ITR) under Section 139(4C) of the Income Tax Act, 1961
NOTE: If these conditions are not followed, the exemption may be withdrawn, and penal action may be taken.
The Visakhapatnam Special Economic Zone has been provided tax exemption on the following sources of income:
- Lease rent (charged as per government-prescribed rate)
- Receipts from I-Card and permit fees
- Allotment fee in respect of standard design factories
- Auction/bid amount in case plots/buildings fall vacant
- Transfer charges in respect of the plot/building
- Fees for the issue of Form-I for the exemption of building plans
- Processing fee for approval of building plans, conveying NOCS, etc.
- Site usage charges from service providers
- Licence fee for allotment of staff quarters to the staff
- Interest on bank deposits
The notification is deemed to have been applied for AY 2024-25 and 2025-26 (FY 2023-24 and 2024-25) and will be applicable for AY 2026-27 to 2028-29 (FY 2025-26 to 2027-28).