Drastic Cut on India’s Corporate Tax Rates

Steven Zenios03/10/20192min
Tax on local businesses in India has been reduced to the lowest rates in Asia. Tax on local business will be reduced to 22% from the previous 30% tax. The announcement was made by Finance Minister Nirmala Sitharaman.

Alongside this announcement, a $20 billion boost has been given to encourage economic expansion as it faces a six-year low. These announcements are part of setting goals that are in place to boost demand and investment following a 5% growth at the end of June.

This reduction of tax makes India level with other Asian rates thus making the location a more desirable place to invest. This incentive comes as an important tome as many are searching for alternative investment destinations due to the issues caused but the US-China trade war.

“In order to promote growth and investment, a new provision has been inserted in the Income Tax Act with effect from the fiscal year 2019-20,” Ms. Sitharaman said

With this new provision, the government has estimated tax revenue of 16.5 trillion rupees in the year to March.

“We are conscious of the impact all this will have on our fiscal deficit,” commented Ms. Sitharaman who has set the target to reduce the budget gap to 3.3% this year.

The new provision also states that manufacturing companies that are created by October 1 will be provided with the option of 15%. The tax rate for new manufacturing firms will be 17% inclusive of tax and surcharge according to Sitharaman.

Steven Zenios

Steven Zenios is a young author and designer with strong passion. A specialist in web design and development, blogger, author and Blockchain entrepreneur. He is the CEO of Web Theoria, a digital agency based in Cyprus. In the last 10 years, he has vastly improved his knowledge and skills to produce great pieces of work, both in the web design industry and article/blog industry. Contact Steven at +357-22029786 ext: 6120 or by email at [email protected] for editorial related questions.

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