In its attempt to boost Micro, Small and Medium Enterprises (MSME) sector, hit by twin blow of demonetisation and the Goods and Services Tax (GST), the government today has cut the corporate tax to 25% from current 30% of companies with a turnover of up Rs 250 crore.
In its attempt to boost Micro, Small and Medium Enterprises (MSME) sector, hit by twin blow of demonetisation and the Goods and Services Tax (GST), the government today has cut the corporate tax to 25% from current 30% of companies with a turnover of up Rs 250 crore.
The announcement was made by Finance Minister Arun Jaitley who presented the Union Budget 2018 in Lok Sabha today.
Jaitley was under pressure to moderate tax rate for the industry which was promised a lower levy of 25% by the government three years ago.
He had promised to reduce the corporate tax rate from 30% to 25% over four years.
In his Budget speech of 2015-16, Jaitley had said "a regime of exemptions has led to pressure groups, litigation and loss of revenue. It also gives room for avoidable discretion. I, therefore, propose to reduce the rate of corporate tax from 30% to 25% over the next four years. This will lead to higher level of investment, higher growth and more jobs."
Jaitley also proposed 100% tax rebate for farmer producer companies having a turnover of Rs. 100 crore.
Here are some major announcements by Jaitley on taxation:
* To reduce corporate tax to 25% for companies who report turnover of up to Rs 250 crore.
* Finance minister said "tax buoyancy more than expected, thanks to greater compliance".
* Jaitley proposed bringing listed entities under long term capital gains tax.
* Long-term capital gains exceeding Rs 1 lakh to be taxed at 10%.
* Proposed to raise import tax on mobile phones to 20% from 15%.
* To raise health and education cess to 4% from 3%.
Catch live updates of Union Budget 2018 here.
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