Exempt computers from excise, custom duty: Nasscom

National Association of Software and Service Companies has demanded exemption of computers from excise and customs duty in order to encourage manufacturers to produce cheaper computers.

National Association of Software and Service Companies (Nasscom) has demanded exemption of computers from excise and customs duty in order to encourage manufacturers to produce cheaper computers.

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"The sale of computers to educational institutions as well as Gram Panchayats and local governments should be exempted from all import and excise duties." the apex IT industry association said in its pre-Budget memorandum.

"Very large quantities of useable computers are discarded or scrapped in developed countries. These second hand computers should be permitted to be freely imported into India on duty free basis provided they are given on free of cost basis to educational institutions-Gram Panchayats," Nasscom said.

Suggesting steps to increase the application of e-governance, Nasscom said Centre should look at funding the state governments' efforts in introducing e-governance and should exempt them from all duties and taxes on purchase of computers and all necessary equipments.

"Government should develop some states and Union Territories as model areas for 100 per cent computerization and e-governance, which could then be spread to other states," Nasscom said.

In the area of IT educational institutions catering to the export markets, Nasscom has suggested the creation of Special Economic Zone (SEZ) scheme that provides incentives and facilities to educational entities similar to those offered to units operating under the Software Technology Parks (STP) scheme.

Nasscom also asked Government to take proactive steps in resolving various issues related to direct and indirect taxes including the recent decision on taxation of non-residents and lack of transparency in the case of exemptions provided to IT software sector on Section 10A, 10B and 80 HHE.