Govt may consider extending deadline for availing 15% corporate tax rate benefit

Finance Minister Nirmala Sitharaman on Monday indicated extending the deadline for availing 15 per cent corporate tax rate benefit on new investmentsby manufacturing units.

“I will see what can be done. We want industry to benefit from the 15 per cent corporate tax rate on new investments and I take your point for considering an extension in the deadline of March, 31, 2023,” she said addressing an industry chamber at a webinar here.

On September 15, the Government announced new measures to attract fresh investment in manufacturing and thereby provide boost to ‘Make-in-India’ initiative. Accordingly, a new provision was inserted in the Income-tax Act with effect from FY2019-20 which allows any new domestic company incorporated on or after October 1, 2019 making fresh investment in manufacturing, an option to pay income-tax at the rate of 15 per cent. This benefit is available to companies which do not avail any exemption/incentive and commence their production on or before March 31, 2023. The effective tax rate for these companies will be 17.01 per cent inclusive of surcharge & cess. Also, such companies will not be required to pay Minimum Alternate Tax (MAT).

She also informed India Inc that the Covid Emergency Credit Facility covers all companies and not just MSMEs (Micro, Small and Medium Enterprises). “We have fairly clearly addressed the issue of liquidity. There is definitely the availability of liquidity. We will look into it if there are still issues,” Sitharaman said while adding that every Government department has been told to clear dues and if there is any issue with any department, the government will look into it.

She assured the industry of all possible Government help with the intent of supporting Indian business and reviving the economy. “We are committed to support/intervene if any of your members have a problem,” she said while suggesting to the industry to submit their recommendations related to the Ministry of Corporate Affairs or SEBI deadlines so that necessary steps can be taken.

On the need for reduction in GST rates in badly affected sectors, she said: “GST rate reduction will go to the Council. But the council is also looking for revenue. The decision for reduction in rate for any sector has to be taken by the Council” .

Finance and Revenue Secretary Ajay Bhushan Pandey said income tax refund to the corporates have started and I-T refunds to the tune of ₹35,000 crore have been made in the last few weeks.

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