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Union Budget 09-10 & impact on Indian IT industry

Written by Devendra Deshmukh | Jul 6, 2009 11:13:00 AM

From IT industry perspective & from my perspective, as an IT entrepreneur, this budget is average one.

Especially STPI scheme is extended only for 1 year, expectations were for min. extension for next 3 year. In absence of long term policy, many SME's cannot plan for strategic initiatives. Larger IT companies already opting for SEZ. MAT increase by 5% also will put additional stress on liquidity.

A) Fringe Benefit Tax (FBT) abolishment B) Exempt value attributable to the transfer of the right to use packaged software from excise duty and CVD C) Service tax refund mechanism based on self-certification or by a Chartered Accountant. D) LCD panel custom duty reduction E) Alternative Dispute Resolution Mechanism for resolution of transfer pricing disputes and CBDT to formulate `safe harbour’ rules : are definitely positive developments for IT industry.

This budget has definitely not done enough to incentivize investment in economy. Still measures to speed-up infrastructure development are positive for overall development of economy.

As a 'Aam Aadmi', its definitely welcome budget & quite a few good incentives for individuals.