Finance Minister Slashes Corporate Tax For Domestic Companies

by GoNews Desk 4 years ago Views 2113

Finance Minister Nirmala Sitharaman's Press Confer

Finance Minister Nirmala Sitharaman addressed a press conference today in Panaji, Goa. The Finance Minister and several State Finance Ministers have gathered in Panaji to take part in the Goods and Services Tax Council Meet.

Addressing her fourth press conference to revive the economy, the FM announced a cut in the corporate tax rate for domestic companies and new domestic manufacturing companies. The following are the highlights of the press conference held on Friday.

  • Corporate tax rate to be 22% without exemptions, inclusive of surcharge and cess.
  • No Minimum Alternate Tax (MAT) applicable to such companies
  • Effective corporate tax rate after surcharge to be 25.17 percent
  • To attract investment in manufacturing, local companies incorporated after October 2019 will pay tax at 15 percent
  • That effective tax for new companies shall be 17.01 percent, including cess and surcharge.
  • Companies enjoying tax holidays would be able to avail concessional rates post the exemption period. 
  • Will give MAT relief for those opting to continue paying surcharge and cess. MAT has been reduced to 15 percent from 18.5 percent for companies who continue to avail exemptions and incentives:
  • To stabilize the flow of funds into the market the enhanced surcharge announced in Budget 2019 will not apply on capital gains arising on sale of any security, including derivatives by foreign portfolio investors (FPI)
  • For listed companies which made announcement for public buyback before July 2019, it is provided that tax on buyback on shares of such companies will no be charged
  • Total revenue foregone by undertaking these measures is Rs 1.45 lakh crore per year

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