For the IT industry, the budget was a mixed bag. NASSCOM said recommendations relating to multiplicity of taxes on packaged software, creation of a dispute resolution mechanism on transfer pricing, abolition of FBT and issues on service tax refund were positives.

“The combined effect of these proposals will facilitate the industry and (encourage) its two-million workforce to compete effectively. The industry will be keen to partner the government in expanding e-governance initiatives including modernisation of employment exchanges, the UIAD project, and smart cards for healthcare services so as to achieve enhanced governance,” said Pramod Bhasin, chairman, NASSCOM.

Deepak Shikarpur, chairman of the IT committee, MCCIA, said the extension of STPI scheme, abolition of FBT and removal of tax on software products meant good news for the IT industry. “Reduction of duty on LCD projector will enhance e-learning. Overall it is a mixed budget for the IT sector,” he said. The negative for the IT industry was that it had wanted the tax holiday under Software Technology Park of India (STPI) scheme extended for five years but got just a one-year extension.