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'Budget Should Bring Uniform Taxation'|
- By CXOtoday Staff, Jul 01, 2009 1543 hrs IST
- Tags : Budget 2009, Rafi Palgi, FTK, dual taxation, software industry, education outlay
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Rafi Palgi, executive manager of FTK, talks about his expectations from Union Budget 2009.
First and foremost, a further increase in our budget outlay for education in general as some long-standing and yet unresolved problems still persist. There is also a case for improving the quality of education imparted in the case of government-run schools and colleges. Reform is required at the level of curriculum-development. Also, one needs to ensure that the students actually graduate with at least a minimum level of computer skill that helps them to compete in the job market.
For computer education in schools and colleges, government should help them to acquire infrastructure. It could include computer hardware, necessary software, faculty, bandwidth, etc. The government should emphasize and encourage schools to adopt software which can enable the students to learn and compute in their own language.
In order to help the software industry help the education sector there should be further cut in the excise duty from currently 12% to 8%. The double taxation that is prevailing on the packaged software including both excise duty or countervailing duty (CVD) and service tax should be removed and should be only one tax levied on packaged software, preferably excise duty. Abolishing the dual taxation system will actually help the overall price of the software to be cheaper.
Lastly, there is confusion on the taxation in the software industry. The packaged software attracts excise duty/CVD, no excise duty/CVD is charged on customized software on media or on license of customized software or even on license of packaged software. When software is downloaded from the Internet, it is subject to service tax.
The state governments should also levy a VAT on software. Due to various modes of delivery of software, licenses, and due to various kinds of software, there is no clarity on the exact taxes to be levied. There needs to be clarity whether software would attract excise duty or service tax, as the same item cannot attract both excise duty/CVD as well as service tax.
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