No impact on tax rates

Mr S. Mahalingam, Chief Financial Officer of Tata Consultancy Services: The increase in MAT in itself does not have any impact on the effective tax rates since that is something that can be adjusted over a period of time. Though MAT has increased, the surcharge has come down and so it (the impact) comes to almost the same (as before). This increase will have an impact on cash flows since our SEZ profits will get taxed. However, from an effective tax rate perspective there will not be any change and it will continue to be in the 22-24 per cent bracket as we had stipulated earlier.

I will not call the STPI not been extended as a dampener as it was on expected lines…to be fair to the government, it did extend STPI for two years since 2009.

Disappointing move

Mr R Chandrasekaran, President and MD, Global Delivery, Cognizant Technology Solutions: The US-based software company with offshore presence in India in SEZs, said that the levy of MAT in what the Budget calls the need “to ensure equal sharing of corporate tax liability” is a disappointing move. It will serve as a significant disincentive for small and medium sized companies seeking the benefits of SEZs.”

Good news on GST

Mr Vilas Kanyal, Head - Asia Pacific, Mastek Ltd: Goods and Services Tax (GST) roll-out from April 1, 2012 is welcome. The Technical Advisory Group (TAG) constituted after last year's budget had proposed a GST Network (GSTN) for managing IT systems including the common GST portal. The existing tax administration systems of the central and state departments will be integrated with this portal thereby providing a seamless system interaction for the users and stakeholders. The common infrastructure and service platform will unify the revenue consolidation process of the government departments at both state and central levels. Recently, the Central Tax Dept, Orissa had launched its e-services tool which includes e-registration, e-filing of returns and e-forms, making it very convenient for the traders and merchants to interact and file returns online with the department.

Funds for skill development welcome

Mr E. Balaji, MD & CEO, Ma Foi Randstad

“The allocation of Rs 500 crore for National Skill Development Fund to promote vocational skill building is a welcome move. About 12 million people enter the labour market every year, out of which only 5% possess a training certification. The National Skill Development programme will have to ensure that the new entrants are gainfully employed by making it easy for them to acquire vocational skills at affordable cost. Similarly, if the Indian industries have to move up the value chain, the public expenditure into innovation and R&D should be increased. In this context, it is heartening to note the setting up of Innovation Councils and linking 1500 institutes with the National Knowledge Network by next year. These measures should produce more research skill. We are in a position to triple our output in terms of patents and research projects.

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