- Zoho, Freshworks, Tally Solutions and Quick Heal Technologies, have written to Union Minister of Electronics and IT Ravi Shankar Prasad for tax deduction at a source on local software products and Softex forms that asses the value of a product each time it gets exported
- Reportedly, Indian Software as a service industry has touched $3.5 billion in revenue in financial year 2020
- Elimination of the Softex forms will dramatically increase ease of doing business for products companies, especially for SaaS companies
According to a report, India’s home grown software product firms have led the government to reform the sector in order to compete better with global rivals. About 120 product companies including prominent ones such as Zoho, Freshworks, Tally Solutions and Quick Heal Technologies, have written to Union Minister of Electronics and IT Ravi Shankar Prasad requesting that the government should do away with tax deducted at source on local software products and Softex forms that asses the value of a product each time it gets exported.
Software product policy
The letter also said “We have represented through iSPIRT (software products industry lobby group) time and again to remove both these provisions, to no avail.” Hence, this was a much needed reform considering the present global economic conditions.
After the GST became central to all sales and purchase data, these provisions are totally redundant, especially for the software products industry. Last year, India had also announced a software product policy to promote local product companies and build a strong eco system.
The letter also added that the subsequent announcement of the software product policy. There was an expectation in the software product industry that the government will make sweeping reforms to promote the industry.
Global Opportunity for SaaS companies
It has also been reported that the Indian Software as a service industry has touched $3.5 billion in revenue in financial year 2020. By 2025, the addressable global opportunity for SaaS companies is expected to be worth $400 billion, as per a study by Nasscom.
This mission is to transform India from an IT services to an IT products destination in order to reach the $5 trillion GDP dream by 2025, said Suresh Sambandam, CEO of SaaS firm Kissflow.
