The Centre on Friday unleashed a Rs 1.45-lakh crore stimulus for Indian companies by slashing their corporate tax rate by eight percentage points, a move that can woo companies to invest more, bring down the cost of goods for consumers and
reboot the economy by creating more jobs.
The basic corporate tax rate was cut to 22% from the existing 30%. The effective tax rate on the companies will now be 25.17% inclusive of all surcharges and cess.
Similarly, the effective corporate tax rate for those companies being set up after October 1 will be 17.01% inclusive of all surcharges and cess. These companies will have to commence production before March 31, 2023. Newly set up manufacturing firms will benefit from the move, aimed at promoting ‘Make in India’.
Separately, the GST Council reduced rates on a host of items of day-to-day use and cut taxes on hotels to boost tourism, a sector which has been witnessing a dip in revenues for sometime.