Even though the whole of India was shivering in extremely cold weather, but the entire market remained hot for various reasons. The first and foremost was Sensex making a nosedive, leaving most of the investors gasping without the sunshine in the sky.
Secondly, Yahoo!’s rejection of Microsoft’s $44.6 billion bid to acquire the company. It remained a talk of the town for many days and today also people are found saying: Why did not Microsoft raise its bid to $100 billion?
And, thirdly, and most importantly, the pre-budget calculations kept people, especially importers, exporters and the manufacturers, busy for the remaining hours.
The demand of the IT traders is that VAT should be implemented uniformly in all the states and abolishing the Central Sales Tax (CST) regime. Secondly, they also require Zero duties on all the IT products. The rationale behind this is that it will help bring down the overall cost of IT products which is at present on the higher side.
City administrations in Mumbai, Thane and Pune charge Octroi on goods brought into or taken out from these cities. This should be done away with to increase the profitability of the channel and discourage grey marketers.
Gaming is picking up in India but the gaming consoles are charged more than 50-per cent duties. It should be rationalized to increase the penetration of gaming.
Secondly, from the software industry perspective, the benefit of tax deduction allowed under 10A/10B of the Income tax Act, 1961 in respect of profits derived from export of computer software should be available beyond March 31, 2009, because the global marketplace has become more competitive and the dollar has weakened in comparison with the Indian rupee. The logic of the industry is that these factors have adversely affected the profitability of the Indian companies.
Besides, the software industry also demands removal of 11.33 per cent Minimum Alternate Tax (MAT), introduced last year. This move came as a setback for the companies which were expecting some deduction. Whatever may be the nitty-gritty of the budget, we want that the budget should contain policies which should ensure sustained economic growth.
Sanjay Mahapatra
Editor
