FICCI Suggests Corporate Tax Rate Cut To 25% And Simpler Alternate Minimum Tax In The Full-Budget

FICCI suggests measures to spur investment and growth including corporate tax rate cut to 25% and a simpler Alternate Minimum Tax in its pre-budget recommendations to the Ministry of Finance. A FICCI delegation led by Mr. Rajan Bharti Mittal, Past President, FICCI met Dr. Ajay Bhushan Pandey, Secretary (Revenue), Ministry of Finance in the pre-budget discussion meeting held at North Block.

The key recommendation was that the focus of the Government should be to spur domestic investment and in order to retain India's competitiveness globally, corporate tax rate cut should be considered. It was stressed that with phasing out of exemptions and deductions available under the Income Tax Act, 1961 ('the Act') and to avoid complexities arising under Ind-AS, there is a need to review the concept of Minimum Alternate Tax (MAT). A recommendation has been made to abolish MAT and extend a simpler Alternate Minimum Tax as is currently applicable to non-corporates to corporates, but at a reduced rate of 10% considering the reduction in corporate tax rate to 25% in line with global trend. The need to restore weighted deduction under section 35(2AB) of the Act for expenditure incurred on scientific research being critical for Indian businesses was clearly stressed upon.

 

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