Budget 2018 has reduced the corporate tax rate for companies with an annual turnover of up to Rs250 crore to 25%.
The announcement was made by finance minister Arun Jaitley in his budget speech in Parliament on Thursday Feb 01,2018
This move is expected to benefit the micro, small and medium enterprises (MSMEs) but will disappoint big corporates that were hoping that the corporate tax cut will be across the board, in line with the finance minister’s earlier promise of reducing the tax rate to 25%, accompanied by a complete phasing out of exemptions
Finance Minister Arun Jaitley, in his budget speech, said the corporate tax cut will help the entire MSME sector and account for 99% of the companies filing tax returns. The government will forego a revenue of Rs7,000 crore
In last year’s budget, the government had reduced the income tax for small companies with an annual turnover up to Rs50 crore to 25%. This is estimated to have benefited more than 667,000 companies, 96% of all companies filing tax returns, at a cost of Rs7,200 crore to the government.
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