 "Corporate tax")
The government lost a little over Rs 1 lakh crore in 2020-21 on account of a cut in corporate taxes, Minister of State for Finance Pankaj Chaudhary said on Tuesday.
In September 2019, the government announced a cut in base corporate tax for then existing companies to 22 per cent from 30 per cent; and for new manufacturing firms, incorporated after October 1, 2019, to 15 per cent from 25 per cent.
Companies opting for these new tax rates had to forego all exemptions and incentives. The effective tax rate for existing units, after considering surcharges and cess -- such as Swachh Bharat cess and education cess, which are levied on top of the income and corporate tax rates -- is 25.17 per cent as compared to 34.94 per cent earlier. For new units, it is 17.01 per cent as against 29.12 per cent previously.
In a written reply in the Rajya Sabha, Chaudhary had said the estimated revenue loss (due to reduction in corporate tax) in FY 2020-21 has been reestimated to be Rs 100,241 crore.
In February, the Minister had informed Parliament that the revenue loss in 2019-20 fiscal due to reduction in corporate tax rate from 30 per cent to 22 per cent was Rs 1,28,170 crore.
As per the corporate tax collection data shared by Chaudhary, in fiscal 2022-23 the provisional revenues stood at over Rs 8.28 lakh crore, higher than over Rs 7.12 lakh crore in 2021-22.
In 2018-19 and 2019-20 corporate tax collection stood at Rs 6.63 lakh crore and Rs 5.56 lakh crore respectively.
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