AIT of Karnataka appeals to CM on sales tax

BANGALORE: Association of Information Technology (AIT) has appealed to Chief Minister S.M. Krishna to roll back sales tax on its products to 0.25 per cent.

President of the association Leslie Lean, who represents nearly 200 dealers and distributors of IT products in Karnataka told that increase in sales tax on IT products from 0 to 8.5 per cent in consonance with the announcement of uniform sales tax will hinder the national and state objective of increasing PC penetration. He said it will also lead to shift of business to neighbouring states and will encourage grey markets.

He pointed out that some of the states had already rolled back the sales tax on IT products and some like Pondicherry and Tamil Nadu had not even accepted the uniform sales tax recommendation. As a result, the IT business in the state had practically come to a standstill due to 8.4 per cent sales tax burden, with people in Karnataka purchasing IT products from neighbouring states.