Govt announces corporate tax reduction, relief in minimum alternate tax, other measures to boost economy
"We today propose to slash the corporate tax rates for domestic companies and for new domestic manufacturing companies," Finance Minister Nirmala Sitharaman said.
The Centre on Thursday proposed to slash the corporate tax rates for domestic companies and for new domestic manufacturing companies as part of measures taken by the government to promote growth and investment, Finance Minister Nirmala Sitharaman announced in a press conference.
The Finance Minister further said, "to boost 'Make in India', another insertion inserted to Income Tax Act with effect from 2019-20, which allows any new domestic company incorporated on or after 1st Oct 2019 making fresh investment in manufacturing will have an option to pay the income tax at the rate of 15%."
Adding more, Sitharaman said, "to promote growth, a new provision has been inserted in the Income Tax Act with effect from fiscal year 2019-20, which allows any domestic company to pay income tax at the rate of 22% subject to the condition they will not avail any incentive or exemptions."
"To provide relief to companies which continue to avail incentive or exemptions, even for them we are giving a Minimum Alternate Tax (MAT) relief, the MAT rate has been reduced to 15% from the existing 18.5%," Finance Minister Sitharaman said.
"To stabilise the flow of funds into the capital market, it is provided that enhanced surcharge introduced in Budget of July 2019 shall not apply on capital gains arising on sale of equity share in a company or a unit of an equity-oriented fund," Finance Minister added.
"The enhanced surcharge shall not apply on capital gains arising on sale of any security including derivatives in the hands of foreign portfolio investors," Sitharaman said.
Moreover, there will be no tax on buy-back of shares in case of such companies as a relief measure for listed companies which have already made a public announcement of buy-back before 5th July 2019, the Finance Minister announced.
"We today propose to slash the corporate tax rates for domestic companies and for new domestic manufacturing companies," Finance Minister Nirmala Sitharaman said.
The Centre on Thursday proposed to slash the corporate tax rates for domestic companies and for new domestic manufacturing companies as part of measures taken by the government to promote growth and investment, Finance Minister Nirmala Sitharaman announced in a press conference.
The Finance Minister further said, "to boost 'Make in India', another insertion inserted to Income Tax Act with effect from 2019-20, which allows any new domestic company incorporated on or after 1st Oct 2019 making fresh investment in manufacturing will have an option to pay the income tax at the rate of 15%."
Adding more, Sitharaman said, "to promote growth, a new provision has been inserted in the Income Tax Act with effect from fiscal year 2019-20, which allows any domestic company to pay income tax at the rate of 22% subject to the condition they will not avail any incentive or exemptions."
"To provide relief to companies which continue to avail incentive or exemptions, even for them we are giving a Minimum Alternate Tax (MAT) relief, the MAT rate has been reduced to 15% from the existing 18.5%," Finance Minister Sitharaman said.
"To stabilise the flow of funds into the capital market, it is provided that enhanced surcharge introduced in Budget of July 2019 shall not apply on capital gains arising on sale of equity share in a company or a unit of an equity-oriented fund," Finance Minister added.
"The enhanced surcharge shall not apply on capital gains arising on sale of any security including derivatives in the hands of foreign portfolio investors," Sitharaman said.
Moreover, there will be no tax on buy-back of shares in case of such companies as a relief measure for listed companies which have already made a public announcement of buy-back before 5th July 2019, the Finance Minister announced.
