Direct Tax Expert For Slashing Of 5pc R&D Cess

Kolkata: Direct tax experts are of the sight that given the new era of knowledge process outsourcing (KPO), and free movement of technology and design and drawings for betterment of Indian manufacturing, the long standing (since 1986) R&D Cess of five per cent, as applicable to an industrial concern, should be scrapped without any further delay. According to Mr Narayan Jain, Vice-Chairman of All-India Federation of Tax Practitioners (AIFTP), and former President of DTPA, as per Section 3(2) of the Research and Development Cess Act, 1986, the cess, to be paid to the Central Government on or before payment towards import of technology by an industrial worry, has now outlived its utility. Any company engaged in construction was now covered within the meaning of an industrial concern, following the changes to the provisions of the Industrial Development Bank of India Act in March 2000. In case of failure in making such payment to the Technology Development Board, penalty likely to be imposed under Section 9 of the R&D Cess Act, of an amount not exceeding 10 times the cess amount in arrear.