The Government of West Bengal on September 6th 2024 issued a notification regarding the clarification on Property Tax and other Incentives for IT/ITES (Information Technology/Information Technology Enabled Services) companies operating in the state. This clarification is aligned with the West Bengal Information Technology and Electronics (IT&E) Policy, 2018.
Key Points from the Notification
1. Continuance of IT&E Policy 2018
The notification reaffirms that the West Bengal Information Technology and Electronics (IT&E) Policy, 2018, remains in force. This policy, which became effective from August 13, 2018, will continue to be applicable until further orders from the IT&E Department. This ensures that the incentives and provisions outlined in the policy will remain operational and available to eligible companies.
2. Ongoing Incentives Under the IT&E Policy 2018
The notification outlines the following ongoing incentives available to IT/ITES companies under the IT&E Policy, 2018:
- Compliance with Commerce and Industries and MSME Departments’ Incentives: The incentive policy for IT/ITES companies will follow the guidelines established by the Commerce and Industries and MSME (Micro, Small, and Medium Enterprises) Departments, subject to necessary adjustments. This ensures that IT/ITES companies benefit from the same incentives and support structures available to other industries under these departments.
- Additional Floor Area Ratio (FAR): IT/ITES buildings will be granted an extra 15% Floor Area Ratio. FAR is a crucial factor in determining the amount of usable floor space that can be developed on a property. This incentive allows IT/ITES companies to expand their building space, facilitating growth and development.
- Property Tax Exemption: IT/ITES companies will be eligible for a 50% exemption on property tax for a period of 12 years. This exemption is applicable up to August 12, 2030. This significant reduction in property tax is designed to support IT/ITES companies by reducing their operational costs and encouraging investment in the state.
Implications for IT/ITES Companies
1. Enhanced Development Potential:
The additional 15% FAR enables IT/ITES companies to maximize their development potential, allowing for more office space and better infrastructure. This can lead to increased operational efficiency and the ability to accommodate more employees and technology.
2. Cost Savings:
The 50% property tax exemption provides substantial cost savings over a 12-year period. This financial benefit can significantly impact the bottom line of IT/ITES companies, making West Bengal a more attractive location for business expansion and investment.
3. Alignment with Broader Incentives:
By aligning with the incentive policies of the Commerce and Industries and MSME Departments, the IT/E Policy 2018 ensures that IT/ITES companies receive comparable benefits to other sectors. This alignment helps in maintaining consistency and fairness across various industries.
