Open AccessNew Corporate Tax: Impact of Corporate Tax Cut on Indian Economy
Author(s) -
Amartya Saha,
Ankita Kumari,
Anuradha Padhy,
Alok Kumar Panda
Publication year - 2021
Publication title -
international journal of recent technology and engineering
Language(s) - English
Resource type - Journals
ISSN - 2277-3878
DOI - 10.35940/ijrte.b6119.0710221
Subject(s) - corporate tax , pace , income tax , liberian dollar , business , value added tax , tax reform , tax avoidance , government (linguistics) , stock (firearms) , direct tax , double taxation , market economy , economy , finance , economics , public economics , engineering , mechanical engineering , linguistics , philosophy , geodesy , geography
On 20th December, 2019, the Central Government introduced the Taxation Laws (Amendment) Ordinance, 2019, which created a favourable taxing environment for the Companies. Through this Ordinance, section 115BAB, which covers all sorts of domestic companies, that is, any company formed and registered in India, was introduced in the Income Tax Act which offered a very low tax rate of 15% (17.5% including surcharge and cess) to the new manufacturing companies. This Ordinance also reduced the Tax rate for domestic companies to 22% (25.17% including surcharge and cess). Additionally under the new corporate assessment strategy, new organizations that set up assembling offices in India beginning in October and initiate creation before the finish of March, 2023 will be charged at a viable pace of 17%. This move did cause a rise in the value of the stock in India, but through this paper, we plan to delve deeper into how this new introduction affected the economy of India – ranging from the stock market to the value of rupees against dollar, the idea behind introducing this Ordinance, while also touching upon what is Corporate Tax and the Corporate Tax system that was present before the introduction of section 115BAB.