Finance minister Nirmala Sitharaman on Monday said she will consider extending the deadline for availing a lower tax rate or tax cut on new investments in manufacturing as the government weighs options to ease the strain on companies.
Union Finance Minister Nirmala Sitharaman, during her address to the members of the industry body FICCI, said the Centre may consider extending the deadline for availing lower 15 percent corporation tax on new investments. The new corporation tax rate is available for manufacturing companies incorporated after October 1, 2019, and that have started operations before March 31, 2023.
“I will see what can be done. We want the industry to benefit from the 15 percent corporation tax rate on new investments and I take your point for considering an extension in the deadline of March 31, 2023,” Sitharaman said.
The government is willing to give additional time to businesses as they are in the process of recovering from the devastating effects of the coronavirus pandemic, including loss of sales because of the more than two-month-long lockdown to stem the spread of the virus, Sitharaman told the national executive committee members of the Federation of Indian Chambers of Commerce and Industry (Ficci).
The Finance minister sought the industry’s recommendations related to the ministry of corporate affairs or SEBI deadlines so that necessary steps could be taken.
The Centre in September last year reduced corporate tax rates from a high of 30 percent to 22 per cent.
It also allowed any new domestic companies incorporated on or after October 1, 2019, making fresh investments in manufacturing to pay income-tax at the rate of 15 per cent. The new tax rates apply to companies which do not avail of any exemptions or incentives.
The Union Minister also said that the COVID Emergency Credit facility covers all companies and not just MSMEs
With regard to the need for a reduction in GST rates in the worst affected sectors, she said, “GST rate reduction will go to the Council. But the council is also looking for revenue. The decision for a reduction in rate for any sector has to be taken by the Council”.
Finance and Revenue Secretary Mr Ajay Bhushan Pandey informed FICCI members that Income Tax Refund to the corporates have also started and I-T refunds to the tune of Rs 35,000 crore have been issued in the last few weeks.
