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Moumita Bakshi

New Delhi , April 25

AN IT expert committee constituted by the Government to increase PC penetration, internet and domestic software market is likely to recommend the mandating of PC finance as a priority sector lending and amending the Income-Tax Act to include deduction of home PC purchase price under recently created Section 80C.

This is aimed at increasing PC penetration to 65 per 1,000 by 2008 from the present 14 per 1,000.

In its report — to be submitted to the Communications and IT Minister, Mr Dayanidhi Maran, on Tuesday — the committee has recommended that all incumbent broadband operators such as BSNL and MTNL be "encouraged" to move towards a subscription model for broadband and PC as a package.

The move is targeted at hiking Internet penetration to 40 per 1,000 from the 5 per 1,000 at present.

On the PC market front, it has suggested mandating PC finance as a priority sector lending, as was done in agriculture. The report suggests that the Income-Tax Act be amended to include deduction of Home PC purchase price under the recently created Section 80C. It also calls for encouraging sub-Rs 10,000 pricing through "challenge taxation levels''.

For instance, PCs of a defined configuration that sell for a price below Rs 9,000 should bear a drastically reduced total tax burden.

Government sources said that the recommendations may also include that all procurement of PCs and related products which are funded by Central or State Government funds be limited to those that are locally manufactured.

With e-governance likely to emerge as a compelling reason for use of PC and Internet in the future, the committee may suggest that due incentive be provided to citizens who interact online.

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