Dealers confused about excise duty cut

Most dealers and assemblers in Bangalore feel that they have been ignored in
the budget. There also seems to be confusion in the co-mmunity whether the
removal of excise duty holds good for individual components or only bran-ded
whole PCs.

R Sridhar, Dealer and Secretary of the Karnataka Dealers Association (AIT)
felt that while the removal of excise duty is welcome, assemblers would not gain
much. " It will benefit only the branded players. The FDI increase will
boost the networ-king business". He was concer-ned about the decision to
remove import duty in 2005. "If the duty is reduced, it would mean that
domestic computer manufacturers would lose out to multinational brands."
Many other dealers echoed Sridhar's views and informed Cyber-Media News that
it was too early to comment on the issue since the finer aspects of the budget
were not clear yet.

MAIT, the apex hardware body also came out with a measured reaction. Vinnie
Mehta, Executive Director, MAIT said, "Reduction in excise duty to nil from
8 percent on PCs is indeed very welcome. This will have the posi-tive impact of
abolishing the grey market and make IT products from the organized sector price
competitive.

"We wish that a simi-lar measure like nil exc-ise, were also adopted for
IT peripherals as a consumer today buys a package-PCs and peri-pherals
together, rather than a standalone sys-tem. Further, according 100 percent
depreciation to IT products would have given additional boost to IT consu-mption
in the corporate sector," he added.

CyberMedia News

Bangalore