Date:22/07/2004 URL: http://www.thehindubusinessline.com/2004/07/22/stories/2004072201681900.htm

Back IT body seeks rollback of sales tax hike

Our Bureau

Bangalore , July 21

THE Association for Information Technology, which protested by shutting businesses in the State against the Government's move to hike sales tax to 12 per cent from the current level of five per cent, has submitted an appeal to the Chief Minister, Mr N. Dharam Singh, to roll back the proposed tax hike.

The association appealed to the Government to classify all IT products including computers, peripherals, package software and UPS under one common head and uniformly tax them at four per cent. It also called for complete abolition of sales tax on annual maintenance contract, works contract and domestic software development.

Close to 1,600 dealers of IT products in Bangalore and 2,000 across the State closed down their operations on Wednesday protesting the Government's move. The effective hike in proposed sales tax amounts to almost 13.8 per cent, as it also includes a 15 per cent cess on sales tax and a turnover tax of about 1 per cent.