Honourable Finance Minister Nirmala Sitharaman addressed a press conference today
Honourable Finance Minister Nirmala Sitharaman addressed a press conference today. The government has brought in the Taxation Laws (Amendment) Ordinance 2019 to make certain amendments in the Income-tax Act 1961 and the Finance (No.2) Act 2019. Following are the changes
💢A new provision inserted in the income tax act with effect from fiscal year 2019-20 allows any domestic company to pay income tax at the rate of 22 per cent subject to condition they will not avail any incentive or exemptions. The effective tax rate shall be 25.17% inclusive of surcharge & cess and such companies would not have to pay minimum alternative tax (MAT).
💢The government has decided to expand the scope of spending 2 per cent profits on corporate social responsibility (CSR) to allow spending on incubators or research grants to institutes engaged in promoting science research.
💢The MAT rate has been reduced from 18.5 per cent to 15 per cent.
💢Enhanced surcharge levied in the Budget shall not apply on capital gains arising in sale of equity shares in a company or a unit of a business trust or an equity fund liable to Securities Transaction Tax (STT).
💢Enhanced surcharge will not apply to capital gains arising on sale of any securities including derivatives in the hands of foreign portfolio investors.
💢For new companies incorporated after October 1, 2019 and commencing production by March 31, 2023, the income tax rate will be 15 per cent. The effective tax rate for these companies will be 17.01 per cent and such firms will also not be required to pay any MAT.
💢For listed companies that have announced buyback before July 5, 2019, tax on buyback of shares shall not be charged.
CA Rohit Goyal