Gujarat has remained in the forefront of industrial development. The establishment of first SEZ in the country has been approved in Gujarat under SEZ Policy of GOI. In addition, the existing Free Trade Zones namely Kandla Free Trade Zone and Surat Export Processing Zone have been converted into Special Economic Zones and these are in operation in the State. Besides, there are new proposals to establish SEZs in the State.

The Central Government has offered various incentives and facilities both to developer of SEZ as well as the industrial units coming up in SEZ. All kind of units namely manufacturing, trading or service activities are permitted in SEZ. All approvals are to be given by the Development Commissioner for establishment of the unit in SEZ. The State Governments are required under the scheme to offer specified facilities and concessions for promotion of units in SEZs.

In the context of Government of India guidelines for the establishment of SEZs, the matter of formulating a policy regarding the dispensations which the State Government will accord to promote the development of SEZs, has been under consideration of the State Government for some time past. After careful consideration, It has now been decided that the following policy will apply to all SEZs in the State namely Kandla SEZ, Surat SEZ and proposed SEZ at Positra, Mundra and Dahej and at any other locations where SEZ may come up in Gujarat, subject to the framework for SEZ determined by Government of India from time to time.

SEZs in the State will be declared as Industrial Township(Notified Area).

SEZ units shall be exempted from electricity duty for ten years period, from the date of production or rendering of services.

SEZ units will be granted automatic approval to set up captive power plant.

GPCB has declared 80 industries which are exempted from requirement of obtaining NOC. These are however, restricted to small scale industrial units only. The list of industries exempted from obtaining NOC will be extended to medium and large industries also. A separate exercise will be carried out to expand the list and to further streamline the system for speedy single point environmental clearance without diluting in any way compliance with environmental protection parameters.

As a part of liberalization process for filing returns, a Consolidated Annual Report (CAR) has been designed, consolidating various periodical returns(quarterly, half yearly etc) under following Acts.

1. Workmen compensation Act 1923
2. Payment of wages Act 1936
3. Factories Act 1948
4. Minimum wages Act 1948
5. Maternity benefit Act 1961
6. Payment of bonus Act 1965
7. Contract Labour (Regulation and Abolition) Act 1970

The units in SEZ will be required to file annually Consolidated Annual Report(CAR) to Development Commissioner, SEZ. The units in SEZ will not be required to file periodically separate returns.

All industrial units and other establishments in SEZ will be declared as "public utility service" under the provisions of Industrial Dispute Act.

For Inspections relating to workers' health and safety, units will be permitted for obtaining inspection reports from accredited agencies as may be notified by the State Government.

b. Complete exemption on payment of stamp duty and registration fee for loan agreements, credit deeds, mortgages etc.. pertaining to SEZ units or which will be executed within the SEZ area.

c. Transactions within the SEZ shall be exempted from all State taxes including Sales Tax, VAT, Motor spirit tax, luxury tax and entertainment tax, purchase tax and other state taxes.

d. Inputs (goods and services) made to SEZ units from Domestic Tariff Area (DTA) will be exempt from Sales tax and other State taxes.

e. Any sales from SEZ to DTA will be treated as import and import duty will be applicable as per GOI policy. Sales tax will be applicable to SEZ goods as applicable to other imported goods. Same Rules and Procedure will be applicable to SEZ goods as applicable to normal imports.

f) Due to tax system constraints, if it is not possible to grant direct exemption to any transactions, such payment of State taxes will be reimbursed to the SEZ units. .

g) The SEZ developer and SEZ units will be eligible to avail exemptions under (a) to (f) above during implementation period as well.