December 19, 2015 2:06:44 am
The upcoming Budget for 2016-17 (Apr-Mar) will detail a roadmap for lowering corporate tax to 25 per cent from 30 per cent at present, economic affairs secretary Shaktikanta Das said, adding corporate tax may be reduced further than 25 per cent over a period of time.
“Our (corporate) tax rates are higher. 30 per cent plus the surcharge and all that put together, the impact is about 34 per cent. It is much higher than the average of (corporate tax in other countries) of about 22-23 per cent. But our effective tax rate is 22.8-23 per cent, that is because of large number of exemptions which have been given…roadmap for phased reduction of corporate tax from 30 per cent to 25 per cent will be unfolded as part of Budget,” he said.
Das said, “25 per cent is the current target. The effort is to move, over a period of time, to reduce it further.”
The economic affairs secretary further stated that as and when corporate tax will be lowered to 25 per cent, minimum alternate tax will become irrelevant.
“Minimum alternate tax is not particularly liked by industry and various other tax holders. Once we are able to reduce the (corporate) tax rate to 25 per cent, the MAT will become totally irrelevant,” he said.
When asked if MAT will be scrapped, Das said no decision has been taken yet.
Commenting on the fiscal health of the government, Das said non-tax revenues are expected to exceed Budget aim of this financial year on account of higher dividends and surplus transfer from the RBI.
Economic reforms need to continue to achieve higher growth rate, Das said, adding Goods and Services Tax (GST) will happen sooner or later in the country and administratively both Centre and states are in a state of preparedness for implementation of GST.
He further stated that technically, there is no bar for introducing GST in the middle of the year and even if the deadline of April 1, 2016 is missed, the government need not necessarily wait till April 1 of next financial year for its implementation.
Highlighting India’s role as engine of global growth, Das said skill development and improvement in agriculture output are necessary to boost the country’s growth.
“India is the only economy growing above 7 per cent. Our target is to move to 9 per cent and try to exceed that,” he said.
The finance ministry will soon detail some major decisions to deal with stressed assets of the banking sector, he said.
“Stressed assets of banks is an area of concern. In the coming few months, some major decisions will be taken to deal with that,” Das said.
Non-tax revenues likely to exceed Budget target
# Commenting on the fiscal health of the government, Das said non-tax revenues are expected to exceed Budget aim of this financial year on account of higher dividends and surplus transfer from the RBI
# He further stated that technically, there is no bar for introducing GST in the middle of the year and even if the deadline of April 1, 2016 is missed, the govt need not necessarily wait till April 1 of next fiscal for implementation
📣 The Indian Express is now on Telegram. Click here to join our channel (@indianexpress) and stay updated with the latest headlines
- The Indian Express website has been rated GREEN for its credibility and trustworthiness by Newsguard, a global service that rates news sources for their journalistic standards.