We are delighted that the Finance Minister singled out the Software Product Industry for mention in his budget speech today. This is momentous… the identity we have been so seeking especially in the corridors of power was finally articulated this morning in the highest legislative body of the land – the Indian Parliament.
We’d like to highlight four things.
- First, the thumping endorsement that came from the Hon’ble Minister of IT and Communications Shri Ravi Shankar Prasad during his visit to Bangalore (July 1, 2014) where he spent a couple of hours with iSPIRT and the Software Product Industry and minced no words in lending the Government’s support to the Software Product Industry cannot be underplayed (link to video).
- Second, the specific text of Section 62 of the budget speech (just 10 days after Mr. Ravi Shankar Prasad’s supportive visit) that focuses on digital India and the “imminent need to bridge the divide between digital “haves” and “have-nots” is noteworthy. The key highlight, of course is the statement about the “special focus on software product startups”.
- Third, Section 103 of the budget speech which states: “In order to create a conducive eco-system for venture capital in the MSME sector it is proposed to establish a Rs. 10,000 crore fund to act as a catalyst to attract private capital by way of providing equity, quasi equity, soft loans and other risk capital for start-up companies”. Another boost by the Government for start-ups. Clearly the Government has its priorities straight.
- Fourth, the taxation issue. Though there was no mention and we were certainly hoping to get a resolution to our issues of dual taxation (VAT and Service Tax) on software products as well as the issue of TDS deduction on software product payments, there is an intent to simplify and rationalise the tax regime with the proposal to set up an industry-CBDT/CBEC interaction committee that will look into industry specific issues and work to resolve them. We will of course take our issues to this proposed committee and remain hopeful that our issues will be addressed.
Meanwhile, various iSPIRT volunteers have shared their views on the budget with the media and these reactions are summarized here. Please spread the word about this to everybody in the software product industry.
Though we could have hoped for more, I think the consistent policy advocacy in recent past and the hard work put in by various spirited iSPIRT members have brought us to where we are today. The stage is now for ours to play on. Let’s make it happen.
A big thank you for being part of this movement,
iSPIRT Team