CXOs Hail More Budget Allocation for e-Governance
CXOs in the IT industry have welcomed budgetary allocations for e-governance related projects such as Unique Identity Authority of India and a centralized tax processing centre at Bengaluru in Karnataka.
Although the Union Budget 2009-10 unveiled by the finance minister on July 6, 2009 came out as a mixed bag of sorts with some industry expectations not being met, IT industry CXOs have by and large welcomed it. The budget has been termed inclusive and as providing the right kind of impetus by them.
There have been some concerns on the continuance of and hike in the Minimum Alternate Tax (MAT) rate, but FBT abolition and the drive to encourage technology education by increasing allocation for creation of new IITs and NITs has found favour with these CXOs.
Naresh Wadhwa, president and country manager, Cisco-India and SAARC
On the face of it, the budget put forth by the government is positive and focuses on inclusive development. It is encouraging, especially the fact that there is a thrust on infrastructure development, rural development, education and social welfare. The impetus to infrastructure development both urban and rural - is a highly visible and much welcome component of this budget.
Leveraging technology as a tool for accountability, better governance, in business and administration is a step in the right direction. The allocation of funds for e-governance investment schemes like the unique identity number for every Indian and the formation of a Centralized Processing Centre (CPC) in Bengaluru to process electronically filed tax returns will enable effective delivery of public services through public private partnerships.
The increased budgetary provision for the scheme Mission in Education through ICT will help take the benefits of IT to the grass roots in a critical sector like education.
The Aam Aadmi i.e. individual tax payer will definitely appreciate the abolition of Fringe Benefit Tax and raised exemption limit for income tax.
Sudip Nandy, CEO, Aricent
Aricent welcomes the Union Budget 2009 as it delivers on quite a few of the expectations of the IT industry. We are particularly pleased with the one year extension granted to the tax holiday scheme as it would greatly benefit the SMEs especially given the tough market conditions faced due to the downturn. It is heartening that the finance minister has abolished the Fringe Benefit Tax and double taxation on the packaged software which will simplify business.
We are also very pleased on the budget s focus on infrastructure, job creation and most importantly education especially to improve the quality of the existing IITs and NITs.
However, the increase in MAT is a bit of a concern as it could impact current cash flow for companies. Although, as we come out of tax holiday and the effective tax rate increases, this increase in MAT could eventually get offset against higher taxes in future years
Ganesh Guruswamy: Vice President and Country Manager, Freescale Semiconductor India
Continued investment in e-governance and infrastructure projects through public and private partnerships will provide the much needed direction and sustained development in an emerging nation like ours. Setting up of Unique Identification Authority of India (UIDAI) and investments in SMART infrastructure offers opportunities for Semiconductor industry to introduce new solutions and will also generate entrepreneurs.
The deduction of Income Tax under section 10A and 10 B which is available in respect of export profit of eligible entities has been increased by one more year up to 2010-11, however, the industry expected the government to extend this by few more years which would generate growth in the IT sector.
I am particularly delighted about the increased focus on development of technical graduates which is essential in a country like ours where human capital is a key asset. Allocation of 2,113 crores for IITs and new IITs will create world-class educational centers that will nurture talent in India.
Neeraj Paliwal, NXP India country manager, NXP Semiconductors
The roll out of the Unique ID plan and a unified smart card program for all families below the poverty line are positive steps and will provide the much needed thrust to develop an integrated national database of Indian citizens. In addition, the imposition of 5% customs duty on Set Top Boxes are welcome moves as this may encourage set-top box manufacturing in India for India’s own market. Furthermore the increased spends on the National Rural Employment Guarantee Scheme (NREGS) and Commonwealth Games should enable the rapid deployment of contactless technology in IT-enabled financial inclusion in villages, and robust infrastructure upgrades that will prepare Delhi for the upcoming Commonwealth Games.
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