TONNAGE OF THE INDIAN MERCHANT SHIPPING

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RAJYA SABHA

A committee headed by Shri Rakesh Mohan was appointed to review Indian shipping and recommend measures for its revival. The modalities for introduction of Tonnage Tax were discussed with the Finance Ministry and a sub-committee comprising six members, two members each from Ministry of Shipping, Central Board of Direct Taxes and Indian National Shipowners’ was formed to finalize the modalities of the proposed fiscal regime and try to structure the required legislation regarding Tonnage Tax. The sub-committee had several meetings to give final shape to the draft legislation on Introduction of Tonnage Tax. In the Finance Act, 2002, scope of Section 33AC was enlarged to twice the aggregate amount of the paid-up share capital, general reserves and the amount credited to share premium account. These steps were taken by the Government to make up the shortfall in order to avoid financial losses to the shipping companies. The above information was given by Shri Dilipkumar Mansukhlal Gandhi, Minister of State in the Ministry of Shipping in a written reply to a question by Miss Mabel Rebello in Rajya Sabha today.

In reply to another question the Minister stated that only the over aged vessels which may also include bigger vessels are scrapped from the fleet to provide tonnage to the new vessels being inducted in the fleet.