NASSCOM seeks extension of STPI scheme by one year

The National Association of Software and Services companies (Nasscom) expects the IT industry may witness attrition levels and average salary hikes of 10-12 per cent next year.
As the Software Technology Parks of India (STPI) scheme benefits are coming to an end this month, incentives are required to keep the momentum, Nasscom President Som Mittal told reporters here.

"We had requested the government that as you are ending the benefit of STPI by March, 2011 and starting the DTC (Direct Tax Code) in 2012, so for one year there is no coverage. So at least for one year you extend (STPI scheme).

It could be employment-based incentive, location-based incentive, and innovation-based incentive to encourage the SME," Mittal said.

Mittal was in the city to participate in Nasscom's first Global Captive Conclave 2011, which began yesterday.

Nasscom, which requested the government to rethink on the imposition of Minimum Alternate Tax (MAT) on companies that were set up in SEZs, is hopeful of a positive outcome.

Mittal said the topic will come up in the Parliament during the discussion on budget.
"The SEZ scheme is eligible till 2014. Any unit that comes up till 2014 will be eligible (for MAT exemption). Any unit that comes up till 2014, there should not be MAT after that you put the MAT.

So we have a continuity of sovereign promise. You said you will do it. So people (companies) have invested. Don't change the rules," he said.