FICCI lauds extension of R

Hyderabad, Feb 28 (UNI) Federation of Indian Chamber of Commerce and Industry (FICCI) state Council Chairman C Parthasarathy today welcomed Union Finance Minister P Chidambaram's announcement of extending the existing in-house Research and Development (R&D) benefit by another five years.

He also lauded the income tax surcharge exemption to firms and companies with taxable income up to Rs one crore, raising the excise duty exemption limit for small scale industry from Rs one crore to Rs 1.5 crore, biodiesel and food mixes.

However, he said the budget had disappointed over tax proposals for the corporate sector. He said the corporate sector expected reduction of tax rates in view of the buoyance in revenue collections.

On the contrary, effective tax incidence would go up by more than one per cent as a result of the new tax proposals, he said.

Prithivi Information Solutions Managing Director V Satish Kumar, terming the budget as ''positive'', said the focus on education was a first step towards producing highly-skilled and qualified IT Professionals.

He said in a statement here that there was also added focus on infrastructure, health care and telecom sectors, which should increase IT revenue.

Former Vice-President of Andhra Chamber of Commerce and Secunderabad Advisory Committee Chairman D Seetharamaiah said the budget proposals were not encouraging on the whole.

''The budget seems to be agro-based. Increase in farm credit, decrease in customs duty for drip irrigation equipment and exemption in excise duty for bio-diesel were helpful in growth potential of rural sector,'' he said.

He added increase in exemption limit for individuals would give only marginal relief. He said increase in dividend distribution tax from 12.5 per cent to 15 per cent was not warranted.

He further added imposition of service tax on income of immovable property relating to commercial activities would discourage infrastructural projects.

UNI