The Hindu Business Line : Nasscom wants tax sops to continue

With the Finance Ministry undertaking a review of tax exemptions including the tax holiday granted to the IT sector, Nasscom today said the issue needed to be examined in the global perspective where ending tax incentives may prompt players to consider other competitive locations for their new investments.

"Continuing the tax exemptions till 2009 is a commitment both ethical and moral as people have made plans and investments based on the existing norms. Any decision on whether to continue the tax exemption beyond 2009 should be taken in view of the worldwide competitive situation," the Nasscom President, Mr Kiran Karnik, said.

Stating that tax exemption debate was not about "software companies wanting more sops," he said, "If India does not give incentives, and others do, the new investments and growth may go into other competitive locations such as China."

According to Mr Vijay Thadani, CEO of NIIT Ltd, the IT industry had been contributing to the GDP growth, and has helped transform the image of the country overseas by demonstrating its IT prowess. "While the industry is not paying direct taxes, at an individual level people have been paying taxes, and thus also contributing to the exchequer," he said.

exemptions

"The industry still has time and scope to grow. The revenues of the largest IT companies in India are miniscule compared to their global competitors. Offering players in India a competitive edge in future would create a good momentum. In my view the exemptions should continue and in case Government decides to discontinue with the exemptions, the phase out should be gradual," he said.

An official release had said yesterday that the Government is committed to simplify the tax laws, minimise the distortions within the tax structure and broaden the tax base.

More Stories on : Industry Associations | Taxation | Software

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
Nokia to connect to youth through street football

Bill to widen scope of services under USO Fund

Nasscom wants tax sops to continue

TVS property in Chennai to be sold through e-auction