Tweet
Finance Minister Nirmala Sitharaman Friday proposed to slash the corporate tax rates for domestic firms and new domestic manufacturing companies. The finance minister said this at a press conference in Panjim, Goa.
The current corporate tax rate has been brought down to 22% from 30%. The effective tax rate will be 25.17% inclusive of all surcharges and cess for such domestic companies. For new manufacturing companies, the existing tax rate is 25% which has been brought down to 15%. The effective tax rate after surcharges and cess will be 17%.
"In order to promote growth and investment, a new provision has been included in the Income Tax act, that allows any domestic companies an option to pay income tax at the rate of 22% without exemptions. Amendments will be made through an ordinance to the IT Act. These companies will not be required to pay MAT," said Sithraman in a press conference ahead of the GST Council meet in Goa.
Sitharaman announced companies that pay income tax at 22%, without any exemption or incentives, will not be required to pay Minimum Alternative Tax. Making the announcement, the finance minister said the new tax rate will be applicable from the current fiscal which began on April 1.
Sitharaman said that the revenue foregone on reduction in corporate tax and other relief measures will be Rs 1.45 lakh crore annually. This, she said, is being done to promote investment and growth.
Sitharaman also announced that there will be no requirement to pay MAT (Minimum Alternative Tax) for those companies which pay income tax at 22% without any exemption or incentives.
She said that the corporate and other relief measures will make 1.45 lakh crore annual reduction in revenue, but these measures are done to promote investment and growth. She added “Tax concessions will bring investments in Make in India, boost employment and economic activity, leading to more revenue,”
The government also announced not to levy enhance surcharge introduced in Budget 2019, on the capital gains arising from the sale of any security including derivatives in hands of foreign portfolio investors.
The current corporate tax rate has been brought down to 22% from 30%. The effective tax rate will be 25.17% inclusive of all surcharges and cess for such domestic companies. For new manufacturing companies, the existing tax rate is 25% which has been brought down to 15%. The effective tax rate after surcharges and cess will be 17%.
"In order to promote growth and investment, a new provision has been included in the Income Tax act, that allows any domestic companies an option to pay income tax at the rate of 22% without exemptions. Amendments will be made through an ordinance to the IT Act. These companies will not be required to pay MAT," said Sithraman in a press conference ahead of the GST Council meet in Goa.
Sitharaman announced companies that pay income tax at 22%, without any exemption or incentives, will not be required to pay Minimum Alternative Tax. Making the announcement, the finance minister said the new tax rate will be applicable from the current fiscal which began on April 1.
Sitharaman said that the revenue foregone on reduction in corporate tax and other relief measures will be Rs 1.45 lakh crore annually. This, she said, is being done to promote investment and growth.
Sitharaman also announced that there will be no requirement to pay MAT (Minimum Alternative Tax) for those companies which pay income tax at 22% without any exemption or incentives.
She said that the corporate and other relief measures will make 1.45 lakh crore annual reduction in revenue, but these measures are done to promote investment and growth. She added “Tax concessions will bring investments in Make in India, boost employment and economic activity, leading to more revenue,”
The government also announced not to levy enhance surcharge introduced in Budget 2019, on the capital gains arising from the sale of any security including derivatives in hands of foreign portfolio investors.
Comment