According to newspaper reports, India is likely to push for zero duty on electronic commerce at the ministerial meeting of the World Trade Organisation (WTO). India's eagerness to push through this measure is backed by the surge in Indian software exports over the past couple of years. Any move to impose taxes on electronic commerce transactions will lead to a cooling-off of demand for software, which will adversely affect the software exporting countries.
One prime concern, however, is the decrease in government's revenue collections, as an increasing amount of business activity gets done over the electronic medium. This includes collections by imposing excise duties, customs duties and sales tax on sales. Particularly for India, which has yet to experience a surge in e-commerce transactions, the implications of this move could have serious consequences for the government's fiscal position.
Although, India's move is aimed at supporting the growth of the domestic software industry, the long-term implications for the economy's fiscal position should be taken into consideration. The government should maybe consider imposing duties only when the industry is well established.
SONATA SOFTWARE share price is trading up by 6% and its current market price is Rs 606. The BSE IT is down by 3.0%. The top gainers in the BSE IT Index are SONATA SOFTWARE (up 6.0%) and INTELLECT DESIGN (up 8.4%). The top losers are ORACLE FINANCIAL (down 1.7%) and INFOSYS (down 2.3%).
TCS share price is trading down by 5% and its current market price is Rs 3,230. The BSE IT is down by 3.8%. The top gainers in the BSE IT Index are SONATA SOFTWARE (up 3.1%) and CYIENT (up 2.9%). The top losers are TCS (down 5.0%) and COFORGE (down 8.0%).
ECLERX SERVICES share price is trading down by 5% and its current market price is Rs 1,245. The BSE IT is down by 2.9%. The top gainers in the BSE IT Index are CYIENT (up 3.5%) and FIRSTSOURCE SOLUTIONS (up 3.1%). The top losers are ECLERX SERVICES (down 5.2%) and COFORGE (down 8.1%).
L&T TECHONOLOGY share price is trading down by 5% and its current market price is Rs 2,882. The BSE IT is down by 3.1%. The top gainers in the BSE IT Index are FIRSTSOURCE SOLUTIONS (up 3.0%) and CYIENT (up 1.9%). The top losers are L&T TECHONOLOGY (down 5.3%) and COFORGE (down 8.1%).
MINDTREE share price is trading down by 5% and its current market price is Rs 2,171. The BSE IT is down by 3.4%. The top gainers in the BSE IT Index are CYIENT (up 3.4%) and FIRSTSOURCE SOLUTIONS (up 3.0%). The top losers are MINDTREE (down 5.2%) and COFORGE (down 7.9%).
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