Union Budget 2015 received a thumbs up from the
Indian IT industry as it welcomed the removal of
Special Additional Duty on IT products.
Union Budget 2015 received a thumbs up from the
Indian IT industry as it welcomed the removal of
Special Additional Duty on IT products.
Presenting the Budget 2015-16 in Parliament, union
finance minister Arun Jaitley said: "I propose to
reduce the rates of basic customs duty on certain
inputs, raw materials, intermediates and components
(in all 22 items) so as to minimise the impact of duty
inversion and reduce the manufacturing cost in
several sectors."
Union Budget 2014-15 provided the much-needed
relief to domestic manufacturers of personal
computers and tablets by addressing the issue of
inverted duty structure suffered by the industry.
However, only partial relief has been provided to the
IT hardware manufacturing industry in limiting the
exemption from levy of SAD to inputs / components
used in the manufacture of personal computers
(laptops / desktops) and tablet computers.
Thus, the instant benefit of SAD exemption does not
extend to other Information Technology Agreement
(ITA) goods where the issue of inverted duty
structure continues. Lack of clarity on the extension
of the benefit of exemption upto the sub-component
level has not completely mitigated the costs being
incurred by a domestic manufacturer of personal
computers and tablets.
According to Amitabh Singhal, director, Telxess
Consulting Services and a founder and former head of
ISPAI and NIXI, "Removing SAD on computer parts
will reduce the end cost of personal computers and
make them cheaper, thus providing a fillip to the
Digital India objectives because the drop in cost of
ownership of computers will spur the adoption and
usage of IT. Cost of ownership of computers has
been one of the roadblocks in the growth of internet
penetration in the country."
In a tweet, Lenovo India's managing director Amar
Babu called Buget 2015 "very positive, pragmatic and
forward looking."
The Department of Electronics and IT (DeitY) too has
been pitching for a package of incentives for the
domestic hardware makers. It had recommended
removal of SAD from inputs and components,
differential excise duty structure for laptops and
desktops and 5% interest subsidy scheme for the
electronics industry. DeitY had also demanded 10-
year tax holiday for manufacturing of mobile
handsets, tablets, laptops, desktops, telecom
equipment, solar cells and medical electronics in the
country.
Union Budget 2015 has also recieved positive
feedback from the country's apex software industry
body Nasscom. In separate tweets, Nasscom
welcomed the announcement on income tax on
royalty fees reduced by 10% and establishment of
Skills SETU (Self Employment and Talent Utilisation
programme).
Kishna Kumar Natarajan, CEO & MD of Mindtree too
termed the budget "good and balanced."
The government has proposed to impose basic
customs duty at 10% on specified telecom products
that are outside the purview of ITA.
It will also exempt all inputs/components used in the
manufacture of personal computers (PCs) from 4%
special additional duty (SAD) and has proposed to
impose an education cess on imported electronic
products to provide parity between domestically
produced goods and imported goods.
Jaitley also proposed to exempt 4% SAD on PVC
sheet and ribbon used for the manufacture of smart
cards.
Praising the budget, Keshav Bansal, director, Intex
Technologies, said, "A good budget, it was big and
bold in the proposals with a good vision. The much-
awaited GST announcement for April 2016 will surely
rejuvenate the industry as manufacturing sector will
become more competitive and support the 'Make in
India' initiative, it will be interesting to see how it will
be rolled out in the coming months. Another
complementing factor was the focus on skill
development, National Skill Mission will be a great
initiative to develop youth employability thus
contributing to the growth of our country. With focus
on growth and job creation, it is sure to drive India's
global competitiveness."
Indian IT industry as it welcomed the removal of
Special Additional Duty on IT products.
Union Budget 2015 received a thumbs up from the
Indian IT industry as it welcomed the removal of
Special Additional Duty on IT products.
Presenting the Budget 2015-16 in Parliament, union
finance minister Arun Jaitley said: "I propose to
reduce the rates of basic customs duty on certain
inputs, raw materials, intermediates and components
(in all 22 items) so as to minimise the impact of duty
inversion and reduce the manufacturing cost in
several sectors."
Union Budget 2014-15 provided the much-needed
relief to domestic manufacturers of personal
computers and tablets by addressing the issue of
inverted duty structure suffered by the industry.
However, only partial relief has been provided to the
IT hardware manufacturing industry in limiting the
exemption from levy of SAD to inputs / components
used in the manufacture of personal computers
(laptops / desktops) and tablet computers.
Thus, the instant benefit of SAD exemption does not
extend to other Information Technology Agreement
(ITA) goods where the issue of inverted duty
structure continues. Lack of clarity on the extension
of the benefit of exemption upto the sub-component
level has not completely mitigated the costs being
incurred by a domestic manufacturer of personal
computers and tablets.
According to Amitabh Singhal, director, Telxess
Consulting Services and a founder and former head of
ISPAI and NIXI, "Removing SAD on computer parts
will reduce the end cost of personal computers and
make them cheaper, thus providing a fillip to the
Digital India objectives because the drop in cost of
ownership of computers will spur the adoption and
usage of IT. Cost of ownership of computers has
been one of the roadblocks in the growth of internet
penetration in the country."
In a tweet, Lenovo India's managing director Amar
Babu called Buget 2015 "very positive, pragmatic and
forward looking."
The Department of Electronics and IT (DeitY) too has
been pitching for a package of incentives for the
domestic hardware makers. It had recommended
removal of SAD from inputs and components,
differential excise duty structure for laptops and
desktops and 5% interest subsidy scheme for the
electronics industry. DeitY had also demanded 10-
year tax holiday for manufacturing of mobile
handsets, tablets, laptops, desktops, telecom
equipment, solar cells and medical electronics in the
country.
Union Budget 2015 has also recieved positive
feedback from the country's apex software industry
body Nasscom. In separate tweets, Nasscom
welcomed the announcement on income tax on
royalty fees reduced by 10% and establishment of
Skills SETU (Self Employment and Talent Utilisation
programme).
Kishna Kumar Natarajan, CEO & MD of Mindtree too
termed the budget "good and balanced."
The government has proposed to impose basic
customs duty at 10% on specified telecom products
that are outside the purview of ITA.
It will also exempt all inputs/components used in the
manufacture of personal computers (PCs) from 4%
special additional duty (SAD) and has proposed to
impose an education cess on imported electronic
products to provide parity between domestically
produced goods and imported goods.
Jaitley also proposed to exempt 4% SAD on PVC
sheet and ribbon used for the manufacture of smart
cards.
Praising the budget, Keshav Bansal, director, Intex
Technologies, said, "A good budget, it was big and
bold in the proposals with a good vision. The much-
awaited GST announcement for April 2016 will surely
rejuvenate the industry as manufacturing sector will
become more competitive and support the 'Make in
India' initiative, it will be interesting to see how it will
be rolled out in the coming months. Another
complementing factor was the focus on skill
development, National Skill Mission will be a great
initiative to develop youth employability thus
contributing to the growth of our country. With focus
on growth and job creation, it is sure to drive India's
global competitiveness."
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