Make sure tax reduction brings in investment: Prasad to his ministrieshttps://indianexpress.com/article/business/economy/make-sure-tax-reduction-brings-in-investment-prasad-to-his-ministries-6014983/

Make sure tax reduction brings in investment: Prasad to his ministries

With an aim to revive investments, particularly in the manufacturing sector, Minister of Finance Nirmala Sitharaman Friday announced reduction of effective corporate tax rate to 25.17 per cent.

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Union minister Ravi Shankar Prasad in Ahmedabad. (Express photo by Javed Raja)

Following the announcement on corporate tax reductions, Minister of Communications and Electronics & Information Technology Ravi Shankar Prasad held a meeting with senior officials of the two ministries, asking them to follow-up on the Finance Ministry’s decision to ensure that the move translates into investments in the electronics and communications sector.

With an aim to revive investments, particularly in the manufacturing sector, Minister of Finance Nirmala Sitharaman Friday announced reduction of effective corporate tax rate to 25.17 per cent. For new domestic manufacturing companies incorporated after October 1, income-tax at a rate of 15 per cent without any incentives will be applicable.

“We want India to be a hub of telecom equipment manufacturing and component manufacturing. Now, there is a robust investor-friendly taxation regime and the duty-regime has also been properly restructured. I have instructed my department officials to follow up on this action and I have myself reached out to many of leaders of this sector,” Prasad told reporters.

The minister had met senior leaders of the electronics manufacturing industry on Monday and asked them to look beyond manufacturing of mobile phones and consumer electronics to focus on strategic, defence, and medical electronics. He said on Friday that the Finance Ministry’s decision is a huge boost to the government’s ambitious Make in India campaign and is expected to result into increased investment in the manufacturing sector.

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