The government has extended the period for availing the lower 15% corporate tax rate on new investments because of the COVID-19 pandemic. It is the most generous reduction in the last 28 years. In the last September, the government slashed corporate tax rates up to 10 percentage points. Now in the present scenario, the base corporate tax for current companies has been decreased to 22% from 30%, and also decreased the tax percentage of new manufacturing units incorporated after October 1st. 2019 and able to start operations before March 31st, 2023 from 25% to 15%. All these actions are taken for attracting private investment and accelerate the economic growth of the nation, which is facing a dip as of now.
As per the statement given by Financial Minister Nirmala Sitharaman, the nation wants industry to benefit from the 15% corporate tax on new investments, and also would like to take the consideration of extending the deadline of March 31, 2023. While addressing members of the Federation of Indian Chambers of Commerce & Industry (FICCI) the Financial Minister gave a word of relief that the government would support the industry with the intent of supporting Indian business and stimulating the economy. Sitharaman also clarified that the COVID-19 Emergency Credit Facility not only covers micro, small and medium enterprises (MSMEs) but also all other companies.
About liquidity, Nirmala Sitharaman clarified that the government has addressed the issue of liquidity. Also, stated that there will be the availability of liquidity and assured to look into issues if needed. According to FM, every government department would clear dues and will acknowledge any concerns with the department and address them rightly.
The government will consider an extension in the deadline for availing the 15% corporate tax rate on investments. The industry should submit its recommendations related to the ministry of corporate affairs or SEBI deadlines. This will help the concerned to take decisive measures. Regarding the need for a reduction in GST rates in the worst affected sectors, it will go to the Council. The GST Council is also looking for revenue. The Council will take any decisions for a reduction in rate for any sector. Revenue secretary Ajay Bhushan Pandey holds FICCI members that income tax refund to the corporates has also started. In the past few weeks income tax refunds of Rs.35,000 Cr. have been issued as well.
