Finance minister Arun Jaitley on Wednesday promised that he would take policy and regulatory steps for benefiting the IT, software and e-commerce industry, which the government would rely on for the success of its ‘Make in India’ and financial inclusion campaigns.
At his first exclusive pre-budget consultation with the IT and e-commerce industry here, Jaitley said that for job creation and efficient delivery of welfare schemes, he would rope in the inherent strengths of this industry which has the ability to overcome structural deficiencies related to business and policy environment.
Business leaders, including Infosys chief executive Vishal Sikka, Wipro CFO Suresh Senapathy, HCL Technologies CFO Anil Chanana and Flipkart chief executive Sachin Bansal, urged Jaitley to grant tax breaks for building infrastructure for large data centers and cloud services within the country.
They also asked for higher budgetary allocation for digital literacy programmes, stable tax regime, direct tax benefits for the sector and resolution of issues relating to double taxation on software products, transfer pricing and duty drawback. Industry leaders also asked for clarity on taxation of software royalty.
There is also a need for lowering the 18.5% Minimum Alternate Tax, the industry told the minister.
Jaitley’s second Budget is likely to have proposals regarding creation of IT-based jobs in rural and urban areas. The Modi government wants to employ IT to make information available to beneficiaries of various welfare schemes and reduce the scope of discretion and manipulation.
The government wants IT sector, which has helped the manufacturing industry to improve its efficiency, to contribute in the same manner to healthcare, education and defence.
Jaitley informed business leaders that large scale production at competitive price for the global market under the Make in India programme will create gainful employment and will help India reap demographic dividend.