Software industry association Nasscom has sought continuation of software technology parks of India scheme where companies get tax benefits, till 2019.
"The best course would be to continue the tax exemption for STPs for another 10 years (beyond 2009) so that companies can continue availing of benefits and have the time to adjust to the special economic zone framework which will take the next two or three years to get operational," it said in the pre-Budget memorandum.
This extension should be made concurrent with the tax holiday provided for exporting units in SEZs, Nasscom said.
It will provide a fresh lease of life to the STP scheme in parallel as this has proven to be such a big success and a major cause of the growth of software industry, Nasscom said.
The association also sought tax exemption to non-residents outsourcing their back office processing and call center activities to India.
It sought modifications in income tax laws to boost the business prospects of BPO industry and address concerns of non-residents.
Nasscom said the law should be amended to state the arms length price payable to IT-enabled/BPO units in India should be determined only on the basis of activities performed in India and without attributing any profits of the non-resident outsourcing such work to India.
The industry body also sought rationalisation of transfer pricing rules and consolidated tax returns in its wish-list.
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