iSPIRT burst forth earlier in February this year as a think tank formed by 30 existing NASSCOM members. Headed by some member from NASSCOM itself, iSPIRT stands for the Indian Software Products Industry Round Table. Not a split from NASSCOM, iSPIRT claims to be dedicated towards promoting existing Indian software product companies and one of the key areas of work is to draft and take policy proposals to government officials. Taking this forward, iSPIRT has released a few blue papers which going forward will evolve into policy briefs.
1) A bluepaper on taxation associated with software products such as excise, services and sales tax
This paper has been drafted by Bharat Goenka of Tally Solutions with inputs from Kailash Katkar from QuickHeal, Shashank N.D. from Practo Technologies, Ramamoorthy, Sanjeev from Tally, Dhanesh from QuickHeal & Kunal Bajaj, iSPIRT. It primarily talks about the ambiguity associated with taxation when it comes to software products and how the umbrella word ‘software’ fails to fall into any of the defined areas of taxation currently. Relying on the premise that the new generation of Indian software products will have a big impact on improving government, labor, and social productivity, the paper urges to have a resolution so that the complexity of opaque taxation policies in day to day transactions is removed.
2) A bluepaper on the Need to level the playing field for software products “Made in India”
This paper has been drafted by Hareish Gur of Newgen Technologies with inputs from Rishi Krishnan from IIM, Bangalore & Sharad Sharma, iSPIRT. The paper deals with the proposition wherein the restrictive trade practices by foreign MNC companies and Consultants are increasingly not allowing Made in India Software Products to participate in Government and PSU Tenders.
Seemingly counter intuitive, there have been instances like where GAIL Consultants have restricted the choice to IBM, SAP and EMC or the Income Tax Department has restricted choice to only Leaders Quadrant of Gartner’s Magic Quadrant. This paper stresses for the need to change this. An example of a country who has done this China that has built a telecom product industry on the back of its domestic market.
3) A bluepaper on the Ownership Structure of Indian companies and promotion of investments
This paper as been drafted by by Nitin Singhal of Fresco Global with inputs from Kunal Bajaj, Advisor to iSPIRT Founder Circle. This paper throws light on the complex ownership, foreign exchange and tax laws in India which has led many tech product companies to move the holding structure to other countries like Hong Kong and Singapore where it is much easier to run a company.
How big is the skew? Example: Registering a company in India= 3 months + Ridiculous amounts of paperwork + $1000 V/S Registering a company in the UK= 10 minutes + No paperwork + $20. The paper urges to make changes so as to reach a change in the scenario.