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|March 18, 1999||
Kerala budget offers more sops to IT companiesThe Kerala government today came out with new proposals to give a boost to the information technology sector in the state.
To facilitate effective implementation of IT, Finance Minister T Sivadasa Menon announced in his budget speech in the state assembly that all the departments would be allowed to set apart up to 3 per cent of their plan outlays for computerisation from this financial year.
Menon said software units would be fully exempted from sales tax. Newly started hardware units would be exempted from sales tax for seven years, subject to a ceiling of 150 per cent of the fixed capital investment.
Software parks and software units set up in such units would be exempted from registration fee and stamp duty.
Menon said the list of electronic goods eligible for the concessional rate of 6 per cent would be revised by including more items.
The government would set up a school for information technology and management as a joint venture at a cost of Rs 300 million through the Kerala State Industrial Development Corporation. It would function as a centre of excellence for providing quality education in IT.
Menon said a venture capital fund for information technology would be constituted. The Kerala Financial Corporation would also invest in the corpus of Rs 200 million to be raised through contributions from the KSIDC and SIDBI.
A sum of Rs 130 million had been earmarked in the budget for the KFC to enable it to support promotional institutions and foster industrial development.
The first phase of the work on creating a state information infrastructure would be in place by September this year.
The minister said the treasury information network would be extended to all the treasuries in the state by November this year.
Once the project is completed, the state would have fully networked banking operations. With this, Kerala would become the first state to have such a comprehensive network.
The Kerala government would also be the first to have the facility for retail banking operations. This would help the state to tap the burgeoning deposits and remittances and utilise them for development of the state.
It would also solve the problem of declining credit-deposit ratio.
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