Financial Daily from THE HINDU group of publications
Monday, May 03, 2004
Financial Daily from THE HINDU group of publications Monday, May 03, 2004 |
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Info-Tech
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Software ESC seeks I-T waiver on software exports Our Bureau
New Delhi , May 2 THE Electronics and Computer Export Promotion Council (ESC) has suggested that profits from exports of Information Technology (IT) products should be given full income-tax exemption. As the different Ministries begin their preliminary budget exercise as general elections get over, the council has said that tax exemption would give a "critical push" to the sector. "Particularly, in the case of computer software and hardware exports, tax breaks had given the exporting community the strength to fight against the falling export margins. Now, the exporters are beset with an appreciating rupee and are is seeking some bold steps from the Government," the ESC Chairman, Mr P.K. Sandell, said in a press statement. Mr Sandell said that Sections 80 HHC and 80 HHF, which have considerably helped the country to build up strong foreign exchange reserves, would become sunset clauses sooner or later and wanted the benefits to be restored.. Referring to the electronics hardware sector, the ESC Chairman said that a stable incentive scheme was necessary to attract foreign direct investment into the country. "Foreign manufacturers will be dissuaded to invest in the country, if the policies are changed every now and then. Also, the relocation of production bases in the hardware sector by multinational companies is to achieve the competitive edge in the global market. Tax breaks like 80 HHC encourage them," he said. The ESC has also pitched for continuation of benefits under Section 10A and 10 B of the Income-Tax Act on a perpetual basis. At present, the benefits are available to software and IT Enabled Servies (ITES) companies only for 10 years.
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