Drop in sales tax on cabinets cheers Maharashtra IT partners 

The state government’s decision to drop sales tax on computer cabinets from 15.3% to 4% has cheered up the channel community and the Trade Association of Information Technology (TAIT) in Maharashtra. Chetan Shah, Proprietor Xpress Computers says, “Now that there is similar sales tax on all computer products, I expect the business to improve to a large extent.” 

According to sources in TAIT, this decision was taken last week, following the seven-month lobbying by the association.

Earlier, cabinets with SMPS were charged a sales tax of 4% and the casings without SMPS were charged at 15.3%. This encouraged many dealers to bill all cabinets as ´SMPS included´ and take advantage of the tax structure.

“The government department associated the word cabinet with steel cupboards. Therefore, we had to clarify and differentiate by adding the word computer before cabinet or casing,” explains CW Kadwatkar IT Secretary. 

According to him, this decision will ensure that traders need not procure cabinets from Gujarat, which had become a regular practice amongst the channel partners. “In fact, distributors like Priya who were not keen on pushing its Krypton range of cabinets, are now interested in selling it in Maharashtra,” informs Kadwatkar 

According to Rajeev Jain, GM, Priya, “The drop in sales tax will make procedures more clear and remove future liabilities.

Our cabinet business was slow, but now we will re-look at our range of products. It may not do big numbers, but we hope to increase the sales by 10% to 20%.”

CYBERMEDIA NEWS

MUMBAI