IT Industry’s Expectations from Finance MInister Ahead of Budget 2023-24
MAT to have two slabs – similar to corporate tax - to help incentivize smaller IT companies – this will help in better-working capital management.
Here are some Budget expectations from Industry leaders:
Mr. Sean Yalamanchi, President, Infovision says:
“As an IT Company, we have our own unique set of issues and expectations from the budget.
- MAT to have two slabs – similar to corporate tax – to help incentivize smaller IT companies – this will help in better-working capital management.
- For smaller IT companies – Government to provide an incentive – a tax holiday for 5 years – to set up offshore development centers in Tier 2 and Tier 3 locations – to improve employment opportunities
- Safe harbor margin notified for companies – This is to be enhanced – from the current limit of Rs.200 crore (company turnover) to Rs.500 crore– The limit has not been revisited for more than a decade. This will help reduce compliance requirements for smaller companies.
Government should actively consider the cost of compliance, litigation, and the refund process to improve the ease of doing business:
- Vendor credit – Government to take steps to enable a mechanism to track vendor compliance on the GST front rather than putting the onus on the service receiver. The cost of compliance is putting a burden on the service receiver.
- Time Limit – With provisions such as Sec 16 (4) of the GST Act wherein there is a time limit for a business taxpayer to avail GST credit, but the time limit to open and re-open assessment under GST Act still remains open-ended.
- Tribunal – Government should prioritize setting up the tribunal for the GST cases to address the grievances or litigation to make compliance easier specially for the SMEs.
- Streamline the faceless assessment process so that the companies are not burdened with additional litigation and/or getting the refund faster”