Union Budget 2012 misses big ticket economic reforms: GTech

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Tvm: Group of Technology companies (GTech) representing the IT / ITeS industry in Kerala has expressed the view that Union budget 2012-13 presented by the Finance Minister missed the opportunity to make bold economic reforms. However, GTech welcomes moves like reduction in customs duty on a host of items, larger outlay for agriculture, incentives for the aviation industry and increased emphasis on the usage of IT for effective service delivery.

Interacting with the media after a Budget viewing session organised by CII Trivandrum Zone, V K Mathews, Chairman, GTech and Executive Chairman, IBS Group, who is also the Chairman, CII Kerala Chapter, said, “The political compulsions seem to have held the Finance Minister from making big ticket announcements. While the steps towards financial consolidation are appreciable, no corrective action on Minimum Alternative Tax (MAT) for SEZ has been taken. We must remember that MAT destroyed the SEZ scheme and STPI benefits were stopped. Tax concession on R & D is definitely a step in the right direction and should benefit the IT industry. Also surprising is that no requests from Nasscom have been addressed in this budget.”

Meanwhile in a release, Anoop Ambika, Secretary, GTech said, “It is good to note that the current rates of corporate taxes have been maintained. What is disappointing is that the Finance Ministry seems to be in a mute mode on some of the major issues that is troubling the IT industry such as transfer pricing, taxation on packaged / downloaded software, double taxation, etc. Also there seems to be no incentive for investors looking at the Tier II / III cities for their further expansion”.

“GTech recommends that the State government in its budget sets up an SPV under the Kerala State IT Mission to make use of central funds and augment entrepreneurship in the State”, added Anoop.

Kerala IT News

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