Exporters may get short-term relief in budget

Exporters, hit hard by economic slowdown in major markets, can expect short-term relief like tax concessions on their net foreign exchange earnings from the interim budget to be presented in Parliament tomorrow.

External Affairs Minister Pranab Mukherjee, who also holds the finance portfolio, would be presenting the interim budget.

The Federation of Indian Export Organisations is demanding abolition of fringe benefit tax, exemption from income tax for net foreign exchange earners and software firms.

It also seeks service tax exemption for units exporting 75 per cent or more of their production besides duty drawback rates at pre-September 2008 level.

However, Commerce and Industry Minister Kamal Nath had asked exporters to face economic downturn without expecting any more big fiscal concessions as "India cannot pull out a package to take care of economic stress in Europe and the US".

The government had announced measures like increase in interest subsidy in its two stimulus packages announced in December last year and January 2009.