Exempt SAD On IT Hardware Components, says MAIT

IT hardware industry body MAIT today asked the government on exemption of Special Additional Duty (SAD) on all components used by manufacturers in the sector.

The industry body also suggested extended concessional excise duty, similar to mobile handset manufacturing, to boost production of PCs and tablets, it said in a statement.

“This budget marks the first litmus test propelling the development agenda. The past years have witnessed an economic downturn and a downturn of domestic growth,” said MAIT President Amar Babu.

“The Budget should address issues curtailing investment sentiment and bring renewed optimism for sustained economic growth, he added.

MAIT Executive Director Anwar Shirpurwala said the budget should give boost to local manufacturing, early implementation of goods and service tax (GST) and credible policies to attract investments.

“Plugging lacuna with respect to Inverted Duty Structures would encourage manufacturing in India. The government should exempt SAD on all components used by a manufacturer of IT hardware,” MAIT recommended.

Reducing the rate of duty applicable on indigenous manufacturing of laptops and tablets is a much-needed move to boost computer manufacturing in a country where manufacturing is disproportionate to demand, it said.

“We recommend a clarification to be issued with regard to software licensors involved in sale of pre-packaged software,” it added.

The industry body said inconsistency in VAT rates for same goods in different states is leading to undue hardships for the manufacturer, while calculating different rates for states. This difference in rates causes a diversion of trade discriminating free flow of trade within the country.

“MAIT sought clarity on the date of implementation of GST with uniformity in procedures and documentation across the country. Also, uniformity in GST rate as well as threshold for levy across goods and services and across the centre and state laws may be published at the earliest,” it said.