Government proposes to implementation for reducing corporate tax from 30% to 25% over the next four years

The Union Finance Minister Shri Arun Jaitley in his Budget Speech 2015 had indicated that the rate of Corporate Tax will be reduced from 30% to 25% over the next four years along with corresponding phasing-out of exemptions and deductions. This is a step towards simplification of tax laws, which is expected to bring about transparency and clarity.

 

 The Government proposes to implement this decision in the following manner:

 

·        Profit linked, investment linked and area based deductions will be phased out for both corporate and non-corporate tax payers.

·        The provisions having a sunset date will not be modified to advance the sunset date. Similarly the sunset dates provided in the Act will not be extended.

·        In case of tax incentives with no terminal date, a sunset date of 31.3.2017 will be provided either for commencement of the activity or for claim of benefit depending upon the structure of the relevant provisions of the Act.

·        There will be no weighted deduction with effect from 01. 04.2017.

 

The details of proposed phasing-out of deductions are available on the website of the Income Tax Department at www.incometaxindia.gov.in.

 

Comments on this proposal may be sent within 15 days to Director (TPL-III) on mail at dirtpl3@nic.inor by post at Director (TPL III), Central Board of Direct Taxes, Room No. 147G, North Block, New Delhi- 110001.

 

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