NEWS /
|
India on Monday extended a tax holiday scheme for outsourcing companies by a year to March 2011, giving a breather to the export-focused sector struggling under a global slowdown. "A longer-term view should have given a better impetus to the industry, which is suffering due to low opportunities in traditional U.S. and European markets," said Girish Trivedi, deputy director of ICT practice at Frost & Sullivan. Presenting the budget for 2009/10, Finance Minister Pranab Mukherjee said "sunset clauses" for deduction of export profits was being extended by one more year to the fiscal year ending in March 2011. Facilities located in software technology parks (STPs) were given a 10-year tax holiday about a decade ago to boost growth in the showcase sector that employs more than 2 million people and accounts for more than 5 percent of the gross domestic product. The scheme was due to end in March 2010. "The tax break extension is an extremely welcome thing but I wish it was done for a longer term," said S. Mahalingam, chief financial officer of Tata Consultancy Services. Brokerage Religare Hichens, Harrison had said in a pre-budget preview it expected the budget to extend the tax-break by another three years, which would boost earnings by 5 to 8 percent for software firms. "It may lead to tax savings," said Surjeet Singh, chief financial officer of Patni Computer Systems. He said the tax rate for the firm would have risen to 30 percent from 18-19 percent if it was not extended. Under the tax holiday scheme, companies in the software technology parks pay taxes only on the business they get from India. Most of them get more than three-quarter of their revenue from exports. Srivathsan Ramachandran, a technology analyst at Spark Capital Advisors, said the extension would benefit only those software services companies who have not yet completed 10 years of operations in the tax-free software technology parks. Infosys expects its tax rate in the fiscal year beginning in April 2010 to rise to 23-25 percent from 18-20 percent in this year as most of its units in STPs will complete 10-year holiday period this year, said chief financial officer V. Balakrishnan. "It will not help all the companies," he said. |
Tags: Union Budget
Mixx
Facebook
Twitter
Digg
delicious
reddit
MySpace
StumbleUpon
LinkedIn
Budget Reactions From The Tech Industry
Here're some reactions from the Tech industry regarding the Union budget.
Leaked Images, Availability, Pricing,
Specs, Pre-order
How time flies. A few weeks ago the BlackBerry world was mad at RIM for a massive 3-day outage. Now,...
The Darkness II - Fear of the Dark
14 Feb, 2012, 12:37 PM IST
8.5
It's quite short and it doesn't have any sort of versus multiplayer but The Darkness II is a polished and brutal shooter you should definitely check out, especially if you like ripping dudes to shreds.
WD Scorpio Blue 1TB (WD10JPVT) Review
Buying Metro tickets through NFC could be a reality by 2016
14 Feb, 2012, 06:01 PM IST
A new report from Juniper Research has found that 1 in 8 (13 percent) of North American and Western European ...
After BlackBerry thumb, medics worry about iPad hand
Citrix CloudStack 3 to offer Amazon-style clouds to customers
Samsung launches three new dual-SIM smartphones, pricing revealed
Angry Birds flying to Facebook on Valentine's Day
VLC 2.0 RC build available for download, iOS version returns
Market Watch: Tablets (Feb 2012)
Tablets have been making rounds for a while now, but it wasn’t until a...
Resident Evil: Operation Raccoon City Interview
We sit down and talk to producer Mike Jones who assures us that fans have...
By Avinash Bali
Top smartphones under Rs. 15,000
The 15K budget has been a sweet deal for those not wanting to spend extra...
By Karan Shah
626 views
More from this Author
_011517074205_160x90.jpg "Epson Stylus Photo R3000")
Samsung launches three new dual-SIM...
How to - Multi-boot Android OS' on...
After BlackBerry thumb, medics worry about
iPad 3 to be announced on March 7, cites...
The Darkness II - Fear of the Dark
Resistance: Burning Skies dated
About Us | Site Profile | Tech2 Team | IBNLive News | IBNLive Hindi News | Cricket News | Indian Stock Market | Policy | T & C
Copyright © 2011, Tech2.com India - A Network 18 India Venture
