Every so often, a slickly packaged press note on a new toilet is kissed and massaged into a front-page “special” on the Corporate Social Responsibility of our IT giants. A few publicity crumbs thrown in public—jackets for the traffic policeman, sponsored sign boards—are hailed as signs of the bountiful munificence of the kaptaans of the knowledge economy. But what after the OB vans leave the campus?
Sheikh Ahmed Ali, the Hyderabad correspondent of CNN-IBN, has just reported that of the over 1,400 IT companies in that City, only four—0.28 per cent—have made it to the list of top-100 tax-payers of the income-tax department. And their overall contribution to the exchequer through income tax is less than half a percent—yes, 0.5 per cent—of what other companies have paid.
Hyderabad’s top-100 companies have made an advance tax payment of Rs 3,486 crore. But the total contribution of the four IT companies is just Rs 10 crore and the highest income tax payment by any of the four is a mere Rs 3.5 crore. Interestingly, the billion-dollar company Satyam Computers, is not on the list of IT payees. Its contribution is only through the tax deducted at source (TDS) that it collects from its employees and vendors.
In stark contrast, are the unsung non-IT companies and individuals. Matrix Labs CEO N. Prasad has emerged as the individual highest tax-payer by paying Rs 26.04 crore. Similarly, with a payment of Rs 1,184 crore, the National Mineral Development Corporation (NMDC) has become the highest tax payer for the year 2006-07.
Of course, it’s cruel to pile on the IT companies because they are only reaping the benefit of the tax exemptions that the sector enjoys. Of course, it’s not right to think that all IT companies are raking in the moolah in the way the big-five do. And, of course, visionary that he is, N.R. Narayana Murthy has always advocated that companies which can afford to pay should be allowed to pay?
The only two things certain in life, they say, is death and taxes. For a lucky few, only one of them, it seems, is certain.