Union Budget 2019: Presenting her first Union Budget, Finance Minister Nirmala Sitharaman announced levying corporate tax at the lower rate of 25 per cent for most of the companies. In her Budget speech, Sitharaman said that the companies with annual turnover up to Rs 400 crore will now be taxed at the lower rate of 25 per cent as a step towards phased reduction in tax rates.
"As far as corporate tax is concerned, we continue with phased reduction in rates. Currently, a lower rate of 25 per cent is only applicable to companies having annual turnover up to Rs 250 crore. I propose to include all companies having annual turnover of Rs 400 crore," Sitharaman said while presenting the Union Budget 2019 in Lok Sabha.FULL COVERAGE: Union Budget 2019
This will cover 99.3 per cent of all the companies, she further added.
"My tax proposals will stimulate growth, incentivise affordable housing and encourage start-ups by releasing entrepreneural spirit. It will also be geared towards promoting digital economy. I aim to simplify administration and bring greater transparency," the Finance Minister said earlier.
"Proposal to increase the limit to Rs 400 crore from the current Rs 250 crore for the application of 25 per cent tax rate coverage while seems large at more than 99 per cent coverage, the possibility of full-scale reduction of tax rate aligned to falling head-line tax rates seems to have taken a back-seat," said Partho Dasgupta, Partner-Tax & Regulatory Services, BDO India.
(Edited by Vivek Punj)