NASSCOM Offer Tax Pointers To New Indian Government

by Mary Swire, Tax-News.com, Hong Kong

20 May 2009

NASSCOM, The Indian IT software and services trade association, has issued to the new government a wish list of fiscal and other measures, that it believes will stimulate its industry, working as 'both an engine and a catalyst for the development of the Indian economy'.

In a statement NASSCOM stated that it "welcomes the electoral result and prospects of a stable and progressive political environment that can focus on long-term policies for the sustainable development of the country".

"The Indian IT-business process outsourcing (IT-BPO) sector is both an engine and a catalyst for the development of the Indian economy and we are confident that the government will continue to partner with this sector for leveraging the benefits of IT for India’s domestic economy and through international trade. We also look forward to working with the government to promote inclusive growth and social benefits through the innovative use of IT."

Some of the immediate priorities that NASSCOM has suggested for the consideration of the government include:

  • Specific policy initiatives to sustain industry’s growth through extension of tax benefits, particularly for SMEs; removal of inequities and multiplicity of taxes on issues like Fringe Benefits Tax, Service Tax and overall uniform policy environment to enhance India’s competitiveness and attract foreign investment.
  • Develop public-private partnerships to accelerate implementation of the already-approved e-governance programs and evolve appropriate new programs; increase government IT budgets so as to provide a strong stimulus to the IT-BPO industry and to the economy.
  • Partner with the industry to implement unique identity card for each citizen using IT, as mentioned in the manifesto.
  • Leverage international relations and build perspectives with key developed nations for continued bilateral trade development with no deviations on protectionist moves through visas and taxation.
  • Continue and expand infrastructure development programs across the country and build integrated IT-BPO townships; provide fiscal incentives for growth of the IT-BPO industry in Tier 2 and 3 towns.

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