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Finance ministry to meet software industry on double taxation issue

Finance ministry to meet software industry on double taxation issue
PTI
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First Published: Mon, May 04 2009. 04 10 PM IST
Updated: Mon, May 04 2009. 04 10 PM IST
New Delhi: The Finance ministry will shortly meet representatives from the packaged software industry to settle the issue of double taxation on the sector.
“We will meet representatives from the industry soon. They will put forth their suggestions, then we will work on the issue,” said a finance ministry official.
The packaged software industry has been reeling under the pressure of rising cost partly led by being taxed twice — service tax as a service and then excise duty as a good.
In fact, the industry has been working with the government to arrive at a solution.
The government like the industry is of the view that there should be only one union tax levied on a good or service, the official said.
However, in case of software when downloaded, attracts service tax, with downloading treated as a service. Later, it faces a duty when a licence for the software is taken, as a good.
Meanwhile, the industry is happy with the fact that the government is working with them to find a solution on the issue.
“We are working with the government to arrive at a solution. The good thing is that the government and the industry both agree that there should be only one union tax which should be levied,” said Vinnie Mehta of the Manufacturers Association of Information Technology (MAIT).
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First Published: Mon, May 04 2009. 04 10 PM IST