24 December, 2015

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CM’s Panel for Service Tax Exemption, Income Tax Sops to Trainers to Boost Skill Development

CM’s Panel for Service Tax Exemption, Income Tax Sops to Trainers to Boost Skill Development

A chief ministers panel has suggested measures like use of funds from education cess and CSR grants and tax sops for training providers to give a boost to skill development in the country (As per Reports by PTI dated 23rd December, 2015)

A sub-group of chief ministers was set up to suggest measures to strengthen the State Skill Development Missions to boost capacity and improve standards of skilling at state level. "The sub group has also recommended that instead of replicating the Information and Communication Technology Academy of Tamil Nadu in each state, the organisation can open branches in willing states, where local administration can be represented for carrying on its activities," Union Skills Development & Entrepreneurship Minister Rajiv Pratap Rudy said in a written reply in the Lok Sabha.

The sub group recommended that skill development programmes and skill training providers should get an extension of service tax exemption for the next five years.
Income Tax exemption to category-A training providers (as per the definition of the Ministry of Rural Development) for a period of five years needs to be considered, it said. Moreover, the state skill development missions (SSDMs) should evolve into a coordinating body to harmonise the skilling efforts across line departments/ private agencies/ voluntary organisations, etc.

The common norms announced at the central level may be adopted by the SSDMs so as to have state-specific guidelines for skill development programmes. For decentralised implementation and to ensure effective coordination and monitoring of skill development initiatives a three-tier structure at state, district and block-level for SSDMs have been proposed by the sub group.

It recommended that SSDMs should have the overarching power to pool across the resources and to utilise according to priority. The inter-linkage of the SSDMs with the industry, training providers, sector skill councils, NSDA should be maintained at the policy formulation and implementation level.

Besides, the sub-group suggested sector skill councils to assist the state skill development missions to align training programme with National Skills Qualification Framework (NSQF). Industry should be incentivised to set up training institutions in PPP mode in industry clusters to facilitate availability of trained manpower for big and MSME units and to adopt existing government ITIs and Polytechnics, it suggested.

The sub group also recommended that skill training in manufacturing sector should be incentivized in all skill development programmes to achieve the Make in India objective. NITI Aayog had set up the sub-group of chief ministers on skill development in March following a decision taken in the first meeting of the Governing Council of the body on February 8 this year.

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