The budget this year although not an exemplary one, is still pretty balanced and will benefit certain sections to a great extent. Unfortunately, the IT industry is not one of them.

The best move by the FM perhaps is not increasing the excise rate from 10% for consumer durables. This will provide a good amount of relief to the industry as well as the customers.  The target for growth of the national economy to the tune of 9% is a healthy one as well.  Providing Income Tax relief by revising the tax slabs and age relief for senior citizens is also a welcome move by the FM. INR 200 Crore investment towards greener India and a 24% increase in allocation for education are certainly positive gestures and will help in betterment of the future generation to a great extent. The declaration of GST coming into force this fiscal year and DTC being introduced in the next is definitely good news for the nation.

However, from our business perspective, there are a few setbacks. We are disappointed that the peak duty for our industry has not been reduced to 7.5% from the present 10% and this additional burden will continue to bother us. But the even bigger setback is that HDDs, CPUs, DVD Writers and other computer peripherals now have a 5% duty levied on them. This will lead to escalation of prices, especially at the assembled PC market and definitely cause inconvenience to our consumers.

Even the concessional rate of 4% on selected products has been increased to 5% which seems unnecessary and an additional burden. An additional duty of 5% has also been levied on the import of mobile phone handsets, which seems a bit insensitive as the industry is witnessing a revolutionary growth at the moment, especially on part of national brands. This will hit the home-grown brands considerably and the additional burden will be carried over to the customers in the form of rise in prices.

Another disappointing issue is the inclusion of the healthcare sector into the ambit of service tax. It will certainly make availability of essential services more expensive for the common man.