5 Points: Corporate Tax rates slashed for domestic companies; markets rose immediately after announcement

5 Points: Corporate Tax rates slashed for domestic companies; markets responded positively

New Delhi, Sep 20

: FM Nirmala Sitharaman has taken some welcome and bold steps to lift up the ailing economy; Corporate Tax Rates have been slashed for domestic companies and new manufacturing firms. 

Just after the announcement the markets immediately rose, with the Sensex surging over 1,300 points and Nifty climbing above the 10,900 mark after days of choppy trading. Five things that FM Nirmala Sitharaman said:

1.Finance Minister Nirmala Sitharaman's press briefing from Panaji: "We today propose to slash the corporate tax rates for domestic companies and for new domestic manufacturing companies."

2. To promote growth, a new provision has been inserted in the income tax act with effect from the 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.

3. FM further said: 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%.

4.  In order 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.

5.  The enhanced surcharge shall not apply on capital gains arising on sale of any security including derivatives in the hands of foreign portfolio investors.

News24 Bureau with Agencies (Input Manish Kumar) Pic Google