Budget 2022-23 Expectations: Consumer tech sector seeks ease of tax rules

New Delhi: India's technology sector, which is famed for its cutting-edge innovative capabilities and global success, has been working diligently to combat the pandemic without causing commercial disruption. Apart from encouraging collaboration among individuals, businesses, and organisations, the sector has accelerated digitalization beyond India's borders, which is a beneficial thing. The sector's significant contribution to the economy in both good and bad times has been unrivalled.

Despite the Omicron danger, the budget comes at a time when the economy is recovering, and the industry is seeking a boost, particularly in terms of tax rules, to assist stimulate total investments and ease of operation.

Here’s what the sector expects from Union Budget 2022-23:

"For the upcoming budget 2022, the government should formulate a policy that focuses on indigenization in high priority technology areas, especially in the SaaS market. As digital transformation and cloud computing gain ground, SaaS has also rapidly become the software-delivery model of choice for enterprises. SaaS subscription-based model opens numerous opportunities across enterprises, and the Indian market is well-positioned to lead the space. Indian SaaS companies are building a talent pool of professionals with SaaS-relevant skills, also powering investors' interest. Within the overall Indian SaaS landscape, enterprise collaboration, tech events, conversational artificial intelligence, and human resources tech – continue to drive investments and interest as businesses look for solutions in a post-pandemic world. The government should recognize the potential SaaS holds for increased contribution to the GDP by restructuring the IT function within the public and private enterprises. This can help streamline processes, build engagement, and deliver overall effectiveness and efficiencies. SaaS adoption is expected to grow across technologies and enterprises, and the industry could reach $1 trillion by 2030. We at Netcore Cloud remain positive on the tech-driven growth opportunities in the country and look forward to some favorable measures from the center." says Kalpit Jain, Group CEO, Netcore Cloud.

“This year, the government is expected to take a progressive step towards making India a hub for the manufacture and export of electronic devices. Consumer electronics product export incentives and low GST. At the same time, analysts expect import tariffs on certain components to continue to rise. I think it's time to go beyond that, we believe that the budget needs to focus more on value creation, including special incentives and subsidies for consumer electronics and component manufacturing. We all agree that India has strong goodwill in the world market. The country will have immense growth opportunities by taking advantage of innovative new technological aspects that facilitate the lives and governance of its citizens. We want a stronger impetus for reinventing the Digital India campaign with better reach, faster, more efficient technology, and a planned schedule,” says Mandeep Arora , managing director, UBON.

“With the budget approaching we expect the government to rationalize the tax slabs for consumer durables. Also to promote R&D and provide incentives for the local manufacturers. With Covid-19 affecting the supply and demand both, the industry seeks support from the government,” says Vipin Agarwal, co-founder of Candes.

“The year 2021 was a challenging one for every sector due to the Pandemic situation. Hence, there're a lot of expectations from the Central Government about its new policies, and if they would announce sops for the industries to sustain. We hope that the upcoming budget will have provisions for strengthening the entire system and take progressive initiatives such as ‘Make in India’ & ‘Digital India’. In the upcoming budget, we are hopeful that the Government would continue extending its valuable support as initiated in the first term with the implementation of uniform GST, 'Make in India', besides offering a host of other initiatives that would help industries to come back to the platforms. Industries to develop newer technology in order to launch innovative products in order to compete with the current market scenario,” says Lalit Arora, co- founder of VingaJoy.

Archit Agarwal, co-founder, Crossbeats said, “We are seeing a positive leap in the consumer industry and many brands have come to the limelight lately, but there are also many other brands that are dimming away from the shine due to vivid reasons. As one of the fastest-growing consumer tech companies in the country, we would love to see some changes in the government policies that are more business-centric. Reduction/exemption in the taxation for manufacturing units present in the country, lowering the percentage of customs duty charges, and better funding support from the banking sector would all be very beneficial to the growth and multiplication of small and mid-range companies in the country.”

Arnav Kishore, co-founder, Fire-Boltt said, “With the Indian economy going digital and the changes ushered in by the pandemic, there has been a significant spike in the consumption of smart devices. The Indian wearable market for instance grew by 93.8% YoY in the third quarter of 2021, pushing home grown players to ramp up their production capabilities to take control of the supply chain and improve margins. Unlike the previous budget, the excise duty on raw materials must be reduced and additionally, more focus should be on enabling manufacturing units under Make in India scheme to reduce the dependence on imports.”