Computer makers seek tax-breaks for buyers

Our Bureau New Delhi | Updated on March 12, 2018

Personal computer (PC) makers on Wednesday has sought Government's subsidy to boost sales. They said investment in information technology (IT) enablers results in higher returns in the form of economic growth, employment generation and tax revenue.

According to a report released by Manufacturers’ Association for Information technology (MAIT) along with KPMG, it said the Indian IT hardware industry can look forward to making a substantial impact by taking some of the steps such as bringing down the hardware cost by 43 per cent with the help of the Government subsidies.

Some of the recommendations also said that Government should reduce the total cost of ownership (TCO) of a PC and broadband solution (currently estimated to be around Rs 15,650 per annum), provide income tax exemption to individuals against PC purchase, and promote purchase of PCs amongst specific segments like students and less than Rs 5 lakh income households.

The report titled, ‘Indian Market Place- IT the unrealised potential’, said that 36 per cent of rural households can afford a PC but still do not own one.

It said increase in sales of desktop and laptops from six per cent today to an compounded annual growth rate (CAGR) of 18 per cent by 2018, would contribute additional gross domestic product of Rs 66,300 crore, taxes of Rs 25,000 crore and employment for 1.11 lakh.

However, if the recommendations are implemented by fiscal year 2018, the total number of persons employed would reach 4.23 lakh on average, contributing Rs 2, 91,700 crore to GDP and Rs 1,10,600 crore in taxes through direct, indirect and induced effects.

This would in turn help boost the sales of desktops and notebooks to grow at seven per cent resulting in the current installed base of around 48 million increasing to around 76 million by end of fiscal year 2018.

“There is no denying that India has a huge potential for the growth of IT hardware industry, we need the right approach to enhance IT penetration and significantly contribute to the economic growth,” Amar Babu, President, MAIT said.

“It’s high time we start extending the reach of PCs to masses who can experience the benefits of computing and connectivity,” Debjani Ghosh, Vice President, MAIT, said.

Coupled with customised modifications of PC, notebooks, and tablets depending on user needs and affordability apart from joint efforts of the Government and the industry, this can make an impact the penetration of IT in the country, she added.

Published on October 30, 2013

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