Given below is the budget expectation quote from Shankar Bhaskaran, VP – International Business and Head of India Operations of Bangalore based MetricStream, a leading market leader in enterprise-wide Governance, Risk and Compliance (GRC) solutions.

“One of the most highly anticipated decisions is around the extension of Tax holiday which expires for all STPIs in March 2011. The increase in tax to at this time would throw the currently volatile Software Industry out of balance and will our ability to deliver International quality solutions at competitive prices especially at a time when most of the world economy is still coming back to normalcy after the economic crisis and budgets are low.  The non extension will impact numerous small and medium companies drastically. 

The other clarification which most organizations in the IT industry are awaiting is the debate around Central tax on Software as a service and the state tax on Software as a product, this double taxation limits the capability for many organizations to procure genuine software for internal purposes.

With the GST roll-out pushed out by a year or two further investment in ACES Automation of Central Excise & Service Tax projects should propel the growth in the IT sector.

We are also hoping for a  further ease in the process of refund of accumulated credit to exporters of services by making necessary changes in the definition of export of services and procedures will help the IT sector especially the BPO’s. 

The Author is Shankar Bhaskaran, VP– International Business and Head of India Operations of Bangalore based MetricStream.