September 27, 2021

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The World Live Breaking News Coverage & Updates IN ENGLISH

‘Will look into issues forcing tech cos to register abroad’

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‘Will look into issues forcing tech cos to register abroad’
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‘Will look into issues forcing tech cos to register abroad’
‘Will look into issues forcing tech cos to register abroad’

Chennai: Union finance minister Nirmala Sitharaman said on Monday that she would look into the bottlenecks of the IT products sector that push Indian SaaS companies to register outside India. In an interaction with industry representatives from CII and Ficci, Sitharaman heard requests and feedback from various sectors. As a hub for the software-as-a-service (SaaS) sector, Tamil Nadu’s tech entrepreneurs stressed that IT products are set to lead to value-creation by Indian IT, and urged the FM to resolve a few hurdles to this.
Software firm Kissflow’s founder Suresh Sambandam told the FM that with a $1-trillion opportunity, the SaaS sector can play a key role in the government’s ambitions of reaching a $5-trillion economy. But the country is losing out on wealth creation as entrepreneurs prefer to register the companies outside India due to various bottlenecks.
“Despite the changes in the business models, on the taxation front, software is still treated as a consulting service and TDS is being levied on sale of essentially a product and I requested the FM to look into it. The legacy system of filing ‘softex’ (software export) forms for assessing the value of software also needs to be done away with as prices are transparent on the websites,” he said. “The FM was receptive to the issues put forward and also asked us to send the ministry a detailed note that she would look into,” Sambandam added.
Cement industry, which was represented by India Cements MD N Srinivasan, sought temporary fiscal relief on coal and pet coke imports. “The price of coal has gone through the roof. What was $70 a tonne is now $170-180 a tonne. There is an import levy of Rs 400 a tonne, and for pet coke it is 11%. Considering the steep increase, we have sought a reduction in levies,” he said. Besides, the MMDR Act for minerals including limestone was impeding capacity addition in the cement sector. “We do not have any objections to the MMDR Act, but it (the levy and rules) should not impede setting up fresh cement capacities,” he said and sought the FMs invitation for pre-Budget meetings for South Indian cement industry.
It is learnt that the representatives of the healthcare sector sought fiscal incentives for hospitals to be set up in tier-2 and tier-3 towns.
The FM said that the government’s disinvestment plan was on track. She also said that the Development Finance Institution announced in the Budget would be operational soon, and that liquidity is no longer a major concern. The Bank-NBFC-MFI channel has been declogged and from October 15 there would be a special drive to reach credit to those who need it, she said.
She also met the representatives of Tamil Nadu Chamber of Commerce and Industry in Madurai and discussed their issues. A key demand from the industrialists was to clear the ambiguity in fixing one GST rate for all the goods covered under one chapter. They also pressed for tax exemption of essential food products, be it branded or unbranded, to motivate all the food manufacturers to go for branding and to ensure quality.

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