Effective tax rates applicable to Indian firms still among the highest

The recent cut in the corporation tax rates may ease the burden on corporates. But more steps are required for making the country globally competitive from the perspective of corporation tax.
 
Effective tax rates applicable to companies in India are still among the highest if one includes taxation on dividends and other means of returning surplus cash to promoters and shareholders. Taking into account taxes on dividend and share buyback, the total tax on corporate profits works out to be 46.8 per cent for the existing manufacturing companies, and 41.1 per cent for new manufacturing units not availing any