Indian IT industry presents Budget wish-list to FM

06 04 09'

Written by Team iPOTT

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Looks forward to extension of STPI tax benefits among others

Even as the new government at the Centre is getting ready to present the Union Budget, the tech industry has begun lobbying for tax benefits and other sops.

During a meeting with Finance Minister Pranab Mukherjee on Tuesday, as part of pre-Budget consultations, representatives from many leading IT companies and organizations, including NASSCOM and MAIT, raised the issues pertaining to SEZ scheme, service tax on software, extension of STPI tax benefits, protectionism in the US market among others.

In its pre-Budget Memorandum, NASSCOM said that the government should consider extension of the availability of benefits under Section 10A/ 10B for units in STPI/EOU and also bring about amendments in the Section 10 AA of the income tax act.

Other demands in the NASSCOM wish-list include removal of multiplicity and inequity of taxes, acceleration of IT adoption in government, nation-wide broadband roll-out and education and skill building.

Said Pramod Bhasin, Chairman, NASSCOM: “The IT-BPO industry with its vast expertise in building global solutions and processes, has the potential to transform the country and play a major role in the development of India’s key sectors including education, healthcare, infrastructure, citizen services and financial inclusion thereby creating significant employment opportunities across India, with a consequential impact on economic growth.”

He said NASSCOM and the industry look forward to working closely with the government on this key agenda. MAIT, the apex body representing India’s IT hardware, training and R&D services sectors, also submitted a memorandum to the Finance Minister and stressed the need for a stable policy regime for the IT hardware industry and for growth-oriented measures to boost domestic IT consumption.

In a pre-budget analysis of the industry and the economy, MAIT executive director Vinnie Mehta said that the monetary and fiscal measures announced by the Government of India in the recent past have been able to instill confidence in the industry to an extent.

“With lower-than-expected consumption of IT products in the financial year 2008-09 owing to the economic slowdown, we now hope for a long-term growth-oriented policy,” he said. In the memorandum, MAIT suggested that the government should continue 8 per cent excise duty/CVD on all IT products – Computers, peripherals and components and abolish Special Additional Duty (SAD) on all IT products and components.

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