Auto industry body SIAM on Friday said the reduction in corporate tax rate and other announcements made by Finance Minister Nirmala Sitharaman would help give boost to local manufacturing in the sector.
The government slashed effective corporate tax to 25.17 per cent inclusive of all cess and surcharges for domestic companies. Making the announcement, Sitharaman said the new tax rate will be applicable from the current fiscal which began on April 1.
"The reduction of corporate tax to 15 per cent for new companies making fresh investments from October 1, 2019 will support investment and also FDI in the auto sector. This is expected to give a big boost to Make in India for automobile industry," Society of Indian Automobile Manufacturers (SIAM) President Rajan Wadhera said in a statement.
Expansion of scope of CSR (corporate social responsibility) expenditure to include incubation centres and R&D activities will also help with expenditure in automobile sector, he added.
"All these set of fiscal measures are expected to uplift market sentiments and improve demand for automobiles," Wadhera said.
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