Union Minister for Finance and Corporate Affairs Nirmala Sitaraman in a press conference in Goa today announced that corporate tax rates has been slashed to 22% for domestic companies and 15% for new domestic manufacturing companies.
This relief in tax has been done through an ordinance to make certain amendments in the Income-tax Act 1961 and the Finance (No. 2) Act 2019, she informed.
The Minister also said that the Government has also decided to expand the scope of Corporate Social Responsibility two per cent spending.
This fund can now be spent on incubators funded by Central or State Government or any agency or Public Sector Undertakings and universities, IIT’s, National laboratories, Autonomous bodies engaged in research in science, technology, engineering and medicine. These decisions are taken to boost ‘Make In India’ projects and to promote research in the country, she added.
The Minister also expressed confidence that the move is well studied whereby industrial growth and investment which is due to increase with this move will compensate revenue forgone for reduction.
Total revenue foregone for the reduction in corporate tax rate and other relief are estimated to be at 1.45 lakh crore rupees.