Budget expectations
2016
Mr. P.
Venkatesh, Director – Product Division, Maveric Systems
What would be the
critical demands from the IT industry to the Government? What does the industry
need in order to continually function in a seamless fashion?
Establishing a task
force..!
There is a need to
establish a task force comprising of representatives, both from the revenue department
as well as the industry segment which includes Manufacturing, Services,
Infrastructure and Government to evolve long term policies applicable to them.
Clarification of Place
of Effective Management..!
In addition, there is a
need to introduce clarification for Place of Effective Management (POEM) that
was introduced in the 2015 Budget. The clarifications should cover:
· Alignment to international and
bilateral treaties by ceding the prevalence of provisions in those if found
favorable to the tax payer- this would cover availability of tax credit,
exemptions for certain incomes from tax, applicability of lower rate of tax and
carry forward and set off losses of the previous years
 |
| P Venkatesh, Director - Product Division, Maveric Systems. |
Shift towards products
and platforms..!
The IT sector is facing
a critical period and needs to step up by moving towards platforms and
products. It is therefore necessary to provide incentives for such development,
and also for re-training and skill-building; this should include subsidies, tax
credits as well as easy financing.
Tax benefits to SEZs..!
Restoring tax benefits
to SEZs – the primary users continue to be the IT sector. It is time that MAT
exemption is granted to units in SEZs; also that the dividend distributed tax
is exempted for such units.
Tax credit for the IT
Services sector..!
IT products are
eligible for research and development tax credit under Sec 35(2AB). IT services
are incurring expenditure when compared to products, in making platforms and
process improvements. A similar benefit should be endowed for such expenditure
too for the IT services sector.
Review of the transfer
pricing policy..!
Setting up of a
committee to review the transfer pricing policy in the light of the various
litigations in the recent years and come up with the revised guidelines.
Media Contact
Smriti Raghunandan -
+9195002 00678 smriti.raghunandan@2020msl.com
Indravati Iyer - +919500050541 indravati.iyer@2020msl.com
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