"Increase of MAT could have been Avoided"
M. Narsimha Rao, president of HYSEA (Hyderabad Software Exporters Association) feels the increase in MAT from 10 to 15% could have been avoided and will only have an adverse impact on the IT industry.
HYSEA is a registered apex body with more than 300 members representing software industry in AP under the Andhra Pradesh Societies Registration Act.
Rao hailed the scrapping of the FBT, extension of the 10A benefits till 2011, increase in the MAT credit period to 10 years and increased allocation to education.
"We believe there are additional steps the government should consider in the few months to boost the IT industry. These include the extension of the 10A benefit for a period of five years (the current extension while it benefits the companies in the short run it doesn’t not lead to new investments to come into the industry), allowing free movement of business between STPI Units and SEZs, and specific incentives to SMEs," opined he.
On the personal taxation front, he said that while the increases in tax limits are nominal, the removal of surcharge on income tax will benefit employees in the IT industry.
"The industry also welcomes the planned outlay of Rs. 2100 crores to create ‘educational infrastructure’ including setting up IITs and interest waivers for educating students. These reforms will clearly bring in a manifold resource increase for employability in the technical stream. While the government is taking steps to improve the quantity & quality of human resources, we believe some incentives for speedier job creation would help in the current global economic scenario," he said.
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