The software technology park (STP) units had been enjoying corporate tax exemption under section 10A and 10B of the income tax act since the past decade now.

NASSCOM president Som Mittal, is advocating the extension for strengthening the SMEs based in Tier II and III cities. However, we must realize that each scheme has a sunset clause and the STPI scheme has already reached the same. Extending the scheme further will be like continuing “reservations/ quota” which were also initially introduced for a period of 10 years only.

When the State cannot discriminate against any citizen on grounds of religion, race, caste, sex, place of birth, how can it discriminate on basis of profession? Why should it be that if an individual has an export oriented software unit, he has to pay no corporate tax but if he is protecting the national borders as part of the armed forces tax is deducted at source from his salary?

We have small and medium enterprises in other sectors operating in Tier II, III or IV cities as well but they are also paying taxes.  Why only the STP units?

The government could have thought of better exemption by passing similar benefits to say unemployed youth for the first (and not ten) year of their employment or to sugar mills which could have at least brought the sugar prices down.

There appears to be no rationale for continuing exemption to big IT companies whose CEOs are now in the list of richest men of the country. Even former Infosys chairman Narayana Murthy has also mentioned in one of his past interviews that the tax exemptions to IT industry should be stopped immediately and if required may be limited to companies having profits less than five crore.

Anyways it appears that the sectors which have the strongest lobbies will get tax exemption. It needs to be seen if the finance minister listens to the aam admi or khaas companies.