Live
- DEO suspends teacher accused of sexual assault
- PM ‘cursing’ Congress out of despair: Maharashtra Cong Chief
- Applications are invited for Junior Colleges Scheme District Scheduled Castes Development Officer Ramlal
- A nomination was filed on the second day for the Nagar Kurnool parliamentary seat
- SP Gaikwad inspected the Telangana Amarnath Saleswaram Jatara yatra arrangements
- Rahul Gandhi's decision to contest from Wayanad shows 'lack of confidence': BJP President Nadda
- IPL 2024: Delhi bowlers will go after all of SRH’s top-order batters, says head coach Ricky Ponting
- At Amroha rally, PM Modi sends out ‘meaningful’ message for Muslims and Hindus
- Tripura records highest 79.83 pc voter turnout in Northeast
- The government has to clear the confusion
Corporate Tax
The startup community has unanimously welcomed lower corporate tax for enterprises with a turnover of up to Rs 50 crore as well as the move to extend the three-year tax exemption for startups in its first seven years from previously five years.
The startup community has unanimously welcomed lower corporate tax for enterprises with a turnover of up to Rs 50 crore as well as the move to extend the three-year tax exemption for startups in its first seven years from previously five years. The move to reduce the corporate tax to 25 per cent for companies with a turnover of under Rs 50 crore was the biggest highlight of the budget as it covers over 96 per cent of the (startup) landscape currently, they said.
But the same benefit was not offered to larger companies which strongly demanded cutting tax rate as it would help them become competitive in the global market. Corporate tax is a form of tax levied on profits earned by businessmen in a particular period of time. Also, while the industry expected exemption from Minimum Alternate Tax (MAT), it has accepted the provision to allow MAT credit to be carried forward from 10 years to 15 years as a positive step forward.
As per the Section 115JA introduced from assessment year 1997-98, all companies having book profits under the Companies Act shall have to pay a minimum alternate tax at 18.5% ((excluding surcharge, education cess, and secondary and higher education cess). MAT is a way of making companies pay minimum amount of tax, according to India Infoline.
Corporate tax in India is levied on both domestic as well as foreign companies. Like all individuals earning income are supposed to pay a tax on their income, business houses too are supposed to pay as tax a certain portion of their income earned. This tax is known as corporate tax, corporation tax or company tax. PwC says a resident company is taxed on its worldwide income.
A non-resident company is taxed only on income that is received in India, or that accrues or arises, or is deemed to accrue or arise, in India. The basic corporate income tax for Indian companies is 30 per cent (25% for MSMEs) and it is 40 per cent for foreign companies. Surcharge, education cess and secondary and higher education cess (effective tax rate) vary from 0.9 per cent to 4.6 per cent for Indian companies depending on the income of the company. For foreign companies, it is between 1.2 per cent and 3.26 per cent.
