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Corporate Tax Rate Cut to 22%: One of the lowest among others

Corporate Tax Rate Cut to 22%: One of the lowest among others

India’s Corporate Tax Rate has been slashed to 22 percent providing indirectly a stimulus of Rs.1.45 lakh crore for private sector.

The government also rolled back enhanced surcharge, announced in this year's Budget, on capital gains arising on sale of equity share in a company or a unit of an equity oriented mutual fund in the hands of an individual.

The new tax rate will be effective from retrospective from April 1.

To boost manufacturing and the ‘Make-in-India’ initiative, the government has slashed corporate tax rate to 15%, from 25%, for domestic companies incorporated on or after 1st October 2019 making fresh investment in manufacturing.

Boosting investment and growth

Soon after the announcement, the Sensex rose by over 2015 points (5.58%) and the Nifty recorded its biggest single-day gain in 10 years by crossing 11,000 points.

This move will make Indian entities more competitive in the global market.

In the long run, the move might prove out to be beneficial for domestic companies to acquire land or hire people.

India has also become almost equal in levying corporate tat to the USA – 21%.

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