Karnataka IT dealers ask government to rethink on ST

From bandh, and rallies, to lobbying support and getting software industry majors to voice their concern against the proposed
12% sales tax increase, dealers in Karnataka are leaving no stone unturned in their fight against
the sales tax hike.

The state dealer organization--Association for Information Technology (AIT)--presented a memorandum to Chief Minister Dharam Singh on July 21,
requesting him to roll back the unexpected hike in sales tax. "In the current year's budget proposal,
the state government has increased the local sales tax from 5% to 12% on computer hardware, peripherals, annual
maintenance contract and software development. This has belied the expectations of the industry and is also detrimental to the development of
the state," read the memorandum addressed to the CM. AIT has appealed for a uniform tax of 4% on all IT products including computers, peripherals,
consumables, package software, networking and UPS.

IT dealers and SIs across the state went on a day long strike on July 21 to show their disapproval against the state's decision.
Dealers in Mysore and Davangere came out in hundreds and held rallies to show their protest.
Dealers in Bangalore are expected to hold a rally on July 27. They have also asked for full exemption of sales tax for annual maintenance contract,
works contract and domestic software development. Apart from this, AIT is also trying to garner support on the issue from
industry bodies like MAIT, CII and NASSCOM.

 CyberMedia News

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