Don't be so relaxed with taxes...it may go up from 2009/10

After a juicy union budget from Finance Minister Mr.P.Chidambaram, we all are very happy...as many of us could have manage to get pass with income taxes. But this may be for a fortnight as some financial experts fear to have some adverse effects.

V. Balakrishnan, Chief Financial Officer, Infosys Technologies, predicted that taxes going upward to 22 percentage in the financial year 2009/10 from about 15 percentage now, if a 10-year taxation vacation ends in March 2009

India's export-driven software services sector had sought the extension of the Software Technology Park of India strategy beyond 2009, particularly for the welfare of tiny amd medium firms, in the federal budget. The proposition did not discover any reference in Finance Minister P. Chidambaram's 2008/09 budget on Friday.

"We will come under full tax regime in 2010," he said. "From 15 percent it will go to 22 percent, the effective tax rate."
The high taxes would get an influence of 2.5-3 percentage for the complete year on the earnings margins of India's second-largest software services exporter, he said.