Budget Wish list - Servion Global solutions

Respected Sir,

Please find the appended below from Mr K Balakrishnan, Managing Director and Chief Executive Officer, Servion Global Solutions. Also find attached his profile and  company's profile for your kind reference.

Mr K Balakrishnan, Managing Director and Chief Executive Officer, Servion Global Solutions

With just few days left for the Union Budget 2009-10, there are various expectations from different sectors and industries. The world has turned upside down since the time the last Budget was presented. Post that, several mini-budgets have been presented as 'stimulus packages' to tackle the global economic slowdown. That's why this year's Budget assumes extra importance.

Expectations from the SME in the IT/ITES sector are running high. Following is the key agenda /wish list for IT/ ITES players like us.

• Section 10 A/10 B to be extended beyond 2009 at least for 3 years, as the continuation of the scheme would provide a level playing field between India and other competing nations, and help sustain the growth momentum. Smaller companies are finding it difficult to rent Special Economic Zone (SEZ) as space is not available at the right location.
• Service tax on Software development to be removed and the controversy on service tax versus sales tax on software development vis-à-vis customization on software products to be addressed. To issue detailed administrative guidance note on the factors determining characterization.  Reduction in service tax rate as well to 8%.
•  Abolish fringe benefits tax totally, especially the FBT on ESOP and travel & accommodation provided to the employees moving onsite.  This is an extra cost to the industry without any justification. Onsite services are an integral part of IT operations and by no means have any 'fringe benefit' in it.  ESOP as a tool to retain and motivate key employees has completely lost its significance currently.
• Set up a mechanism for advance pricing agreements on transfer pricing issues similar to the existing mechanism for issuing advance rulings to provide certainty on issues of tax interpretation and principles. This will provide much needed tax clarity and avoid protracted litigation against transfer pricing adjustments at the field level.

Kindly let us know incase any more information required on the same.

Thanks & Regards,
Aarthi Jayaram
Senior Management Associate
IPAN Chennai
Mob : +91 9940664489
Dir : 044 28275294
aarthi.jayaram@ipan.com

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