Some things don't change like the IT industry's budget wish list. Much like the last 5 years, this year's list also leads with an extension of the tax benefits under the software technology parks of India scheme.
The Indian IT industry has submitted a long list of demands to the finance minister and while this has a few new demands, most are ones that have been seen on the list in previous years like a plea to extend the tax SOPs for software technology parks for another year or till the direct tax code (DTC) is implemented.
Som Mittal, Chairman, Nasscom, said, “We have requested the finance minister to extend the 10a, 10b benefits, the STPI benefits till such time that the direct tax code comes. It is imp that there is a bridge provided between the sunset and the direct tax code coming in.”
Another repetitive plea is that the 20 per cent minimum alternative tax should be halved.
“The second request that we have made is of MAT. 20 per cent of MAT on a continuous basis puts huge pressure on our SMEs and world over its one third of the tax rate so, it should be back to 10 per cent,” added Mittal.
The industry also agrees on the need for more clarity on tax-related issues.
Kris Gopalakrishnan, CEO, Infosys, said, “For the industry, clarity should be there on the issues related to tax etc. because we have to reduce the friction to business. We cannot put the industry through multiple rounds of these negotiations and appeals.”
Will the provision of more incentives boost employment in the sector?
TV Mohandas Pai, Director & Head-Finance, Admin and HR at Infosys, said, “If I was the finance minister, I would increase employment. Because of the bad policies in India, India has lost up to 400,000 jobs to Philippines and China. So, the government needs to create SOPs in this budget to increase employment generation.”
Another new entrant to the list is for policies giving India an easier business environment. For instance, a policy that makes for quicker service tax reimbursements. Nasscom says that over 3,000 crore in service tax refunds are pending and this has led to IT companies being hauled into court.
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