BANGALORE: Bangalore Chamber of Industry and Commerce (BCIC), in its pre-Budget memorandum on direct taxes submitted to the Union Ministry of Finance, has outlined several concerns of the industry related to Direct Taxation.
The Chamber feels that Minimum Alternate Tax (MAT) is detrimental to the economy. The high rate of MAT (20 per cent) has created severe hardships, so the Chamber has sought rationalisation of MAT rates and urged the ministry to bring it down to 10 per cent. It has recommended that the provisions of MAT should be withdrawn in respect of Special Economic Zones (SEZs), so that economic viability of these SEZs is protected. On the issue of TDS deducted in excess, BCIC has recommended a detailed mechanism to be evolved thereby allowing adjustment of excess TDS paid against future payments in the same financial year. The Chamber has also sought extension of weighted deduction under section 35(2AB) may be extended to IT sector by amending the provisions of section to include Information Technology along with Biotechnology so that there is a complete clarity that the weighted deduction would be available to an assessee engaged in production of computer software.