Andhra Pradesh - Hyderabad   

IT sector may come under tax net soon

YSR holds meeting with officials

Hyderabad: Commercial Taxes Minister Konathala Ramakrishna said here on Thursday that Information Technology and Industries departments had been asked to study the taxation policy on IT and IT enabled services in neighbouring States.

Replying to a questionhe told mediapersons that officials have been asked to examine the tax pattern in Tamil Nadu, Maharashtra and Karnataka. The Chief Minister earlier in the day held a meeting with Ministers and officials of major revenue earning departments on funds mobilisation.

“Officials have been asked to start preliminary talks with the professional bodies representing the fast growing industry,” Mr. Ramakrishna said. The Supreme Court had recently given a ruling on the imposition of taxes on the IT and ITES, the Minister said, adding that officials were asked to study the verdict.

The Minister said that although the Government had been cutting taxes during the last three years, it had no intention of imposing any fresh taxes. “No other Government has reduced taxes as the State Government had done in the recent past,” he said.

Tax revenue collected till May this year was Rs. 2,731 crore which was Rs.537 crore more than last year. The current growth rate of 24.52 per cent is higher than States like Maharashtra, Gujarat, Karnataka, Madhya Pradesh and Tamil Nadu.

Mr. Ramakrishna, however, admitted that the revenue was Rs. 91 crore short of the target of Rs, 2,822 crore. The Government was studying whether this was due to the fall in growth rate of taxes on petroleum products. It was examining measures to bring more new commodities such as iron, steel, edible oil and plywood under the tax net, he added.

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