Published on August 24, 2017
Indian Oil Corp and Odisha has reached a settlement on tax related issues to Paradip refinery under which the company will begin paying state taxes in exchange for the state government giving Rs 700 crore as interest fee loan annually for 15 yearsas viability gap funding. It is agreed that state government will give Rs 700 crore per annum interest free loan for 15 years; earlier state head agreed to provide total deferment of VAT," Pradhan tweeted.
IOC will have to immediately deposit all applicable VAT and goods and services tax (GST) on Paradip products for the period the refinery has been operating, according to oil ministry officials. The refinery began production in late 2015. For future, taxes will be paid as they come due.
In return, Odisha will pay Rs 700 crore annually, as viability gap funding, in four equal installments in each quarter in the form of interest free loan for 15 years starting 2016-17, officials said. The repayment of the amount will start in the 16th year. Odisha will give the interest-free loan for 2016-17 and three quarters of 2017-18 by January 2018.
