Channel want less tax, more sops

Every year the Budget is looked forward to with much anxiety and hope. While
some segments are impacted in a positive manner, others feel the announcements
carry no significant news. This year, with the Budget just around the corner, we
spoke to channel partners across the country, from a cross section of verticals,
dealing with different products and services, about their expectations from the
Finance Minister this year around. A majority felt that the taxes on software,
accessories and peripherals should be reduced in order to encourage organized
trade. Others shared that they were looking forward to taxes being decreased and
sops being introduced.

WEST

Umang Mehta, MD, Roop Technologies, Mumbai

We want eight percent rationalization of excise on all products. Presently
there are different rates of excise for different products and we want a single
excise rate for all the products. Apart from that we also expect the removal of
four percent SAD, which is applied on imports, or else give credit against VAT.

Zainul Tinwala, CEO, HT Impex, Mumbai

In the past three years the budget has always brought good news for the
importers of IT products. We want the government to increase the abatement
amount on IT-products since last month only the Excise and Customs Department
had applied excise on MRP. We want the excise department to increase the
abatement from 25 to 50 percent.

Yogesh Thakkar, CEO, Rhythm Electronics, Vododara

We want the government to rationalize taxes all over the country. Apart from
that we want the government to give some kind of incentives to the users so that
they are motivated to buy PCs and that will lead to indirect growth of the
industry.

SOUTH

Sanath Babu, Director, Sri Durga Computech, Bangalore

In the forthcoming budget we are hoping that taxes come down. Whether it is
income tax reduction or a cut in customs duty we hope that there would be enough
sops and benefits for the hardware industry. Also, we are looking for some price
reduction and related sops in the memory card and hard drives space because that
may help reduce the impact of the gray market on our trade.

Prabhakar Kini, CEO, Kinfotech, Bangalore

As far as the forthcoming budget is concerned I am hoping that the limit for
personal taxation is extended to Rs 1.5 lakh. As far as the IT trade is
concerned I hope that the tax exemption for IT companies, especially small and
medium software businesses is extended from the current 2010 to another five
years at least. Thirdly I hope that traders who have suffered a negative impact
due to rupee appreciation are given some benefits and compensation.

Ketah Shah, CEO, Kruthicomp, Bangalore

As far as the budget is concerned I hope that there is a rationalization of
duty rates for products across the hardware industry. First of all there needs
to be a better classification of IT products as to which products fall under the
'IT' category. Given the buoyancy in the Indian market I am not sure that we
would get any tax reductions or sops this time.

Sunil Kukreja, CEO, Kukreja Electronics, Bangalore

With the rupee depreciation that we have seen in the recent times, I do not
expect any price reduction. On the contrary I feel prices of IT products would
actually increase. However I still feel we can expect some reduction in the
excise duty in the forthcoming budget.

Mohit Hegde, CEO, Creative Infotech, Bangalore

I don't have many expectations from the forthcoming budget. However, I still
would look forward to some tax reduction because I feel taxes are being imposed
on almost everything right now. We would certainly benefit from some reductions.

Sathya Prasad, CEO, Vanpac Systems, Bangalore

As of now the customs duty on IT products is not very high. However, I feel
it can be reduced further. Without having too many expectations from the budget,
I hope that there would be considerable reduction on the excise duty as well.
That would definitely benefit us.

Satyen Vyas, CEO Vitage Systems, Bangalore

I do not have any specific expectations from the budget this year. However
if the government could advance or pre-pone the implementation of the GST, it
would do us good. I hope that happens.

Harish Shetty, Director, Binary Systems, Bangalore

Our expectations from the budget this year would be a reduction in customs
tax and a possible duty reduction. Service tax, which is currently pretty high,
needs to be reduced definitely. In addition we would want relief in personal
taxation and also some sort of streamlining on fringe benefit tax, like those on
conveyance and mobile.

Jayessh Mehta, CEO, Future Businesstech, Bangalore

As far as expectations from the budget, we are definitely looking forward to
reductions in excise duty. Also the CST we expect would be reduced by one
percent. This would become beneficial to us. All in all however we do not have
too many favorable expectations this year.

NORTH

Inderpal Singh, Aman technologies, Jammu

This budget, the expectation is that the price should go down in the market
of peripherals, memory products and accessories. Specifically, government should
remove taxes from software products in order to increase its promotion in the
market. Custom duty on IT products should also go down.

Kishore Makhija, Priyanka Computer Services, Raipur

I don't expect anything new from the budget. I guess there won't be anything
as such that would have any effect on the IT industry. Last year also, the
budget did not have any impact on the IT industry and this year also, it would
be more or less same.

Udit Kumar, Life Computer, Varanasi

With the forthcoming budget, I am expecting the prices of IT products to be
reduced so that the market penetration of technology reaches a higher level in
the non-focused market of B and C-class cities.

EAST

Dayananda Ratho, Director, Cyber Software & Services, Bhubaneswar

Software prices in India are still on the higher side, which is encouraging
usage of pirated versions. It's high time the government should revise the tax
structure levied on software and bring some reformation into it so that it
enhances the sale of original software. Though I have my doubts, I am hopeful
that this budget our Finance Minister will announce some relaxation on the same.

Rajesh Kumar, Director, Peripheral Engineers, Patna

As per my knowledge the government is going to bring down the excise duty
from existing 16 to 12 percent. That will really help the Indian PC and
peripheral market to grow further. In such a scenario, prices of printers and
MFDs, hard disks and LCD monitors are going to reduce post budget. I am looking
forward to that because this formal declaration will encourage the customers and
I am expecting a good sale of these products from April onwards.

VK Bhandari, CMD, Supertron Electronics, Kolkata

As far as memory products are concerned I think the Indian government should
make all efforts to bring down the duty as much as possible. Sadly the market of
RAM in India is still dominated by gray trading, therefore to streamline the RAM
market and make it organized it is essential to bring down the existing duty
rate. Apart from that the CV should be brought down from existing 16 to eight
percent, which will overall be beneficial for the Indian IT hardware industry,
as the affordability factor would increase further.

Rajendra Seksaria, Director, Balaji Solutions, Kolkata

It is expected that the excise duty will be brought down from 16 to 12
percent. In fact I am expecting that the duty be reduced to eight percent.
However, in case the excise duty is reduced products like, motherboard,
printers, MFDs, hard disks, RAM, etc will benefit. This will especially be
beneficial for the memory market, which is largely dominated by unorganized
sector.