ECGC, subvention to live one more year

The Union Budget today extended to March 31, 2010 the benefits to Export Credit and Guarantee Corporation (ECGC) cover of 95 per cent and the interest subvention of 2 per cent on pre-shipment credit for employment-oriented export sectors.

Exporters are also now exempted from paying service tax on amount paid to transport and commission agents. Previously, they have to first pay the tax and then claim refund.

Service tax exemption for other services will be based on self-certification of the documents where such refund is below 0.25 per cent of FOB (freight on board) value. The exemption would be operated through the existing refund mechanism based on self-certification of the documents.

Also, the export promotion councils and the Federation of Indian Export Organisations will be exempt from service tax on membership and other fees collected by them till March 31, 2010.