NEW DELHI: Computer-makers in India are asking for a removal of minimum alternate tax and abolition of 4% special additional duty ( SAD), to boost the PC industry, which is facing declining sales and demand. Sales of personal computers in India is expected to grow only 3% this year, falling back to levels in 2008.
Desktop PC sales are expected to decline by over 10% from last year, for the year to March, 31 due to a weak demand environment, especially from corporates.
Manufacturers Association of Information Technology (MAIT), which counts all major manufacturers like Lenovo, Dell, Intel, HP, HCL, Canon, Acer and Microsoft as its members, says that demands met in the forthcoming
Budget will decide long-term profitability of the industry in India.
MAIT's President Alok Bharadwaj said: "With lower-than-expected consumption of IT products whose import costs have gone up owing to the Thailand flood and rupee devaluation, we are now hoping for long-term investment-friendly policies to provide much needed drivers."
MAIT said that PC peripherals such as keyboards attract zero import duty. But keyboard components keypads, polycarbonate, paints, and plastic attract customs duty of 10%, which discourages local manufacturing, and hence should be corrected.
It said that LCD and LED TVs attract zero duty on finished goods under Free Trade Agreements with Thailand. But LCD & LED panels attract 5% basic customs duty. Bharadwaj also asked for exemption of duty on camera lenses and accessories, which is giving a fillip to the grey imports market. The association has submitted its proposals to the Finance Minister. PC makers are also asking for a continuation of the exemption from excise duty in locations like Pant Nagar in Uttarakahnd for the entire 10 years, since companies like Lenovo and HP have made investments on that premise.
It also said that manufacturers invested in Jammu and Kashmir should be reimbursed 100% excise paid from March 27, 2008, the date on which the refund amount was reduced to 36%.
Abrupt changes in government policies give a negative signal to foreign investors, Sabyasachi Patra, executive director, MAIT said. The body also asked the government to encourage finance Schemes for PC purchase at low interest rates, and a subsidy on broadband access charges in rural areas.
Source : economictimes.indiatimes.com