Taxontips
No Result
View All Result
Wednesday, February 1, 2023
  • Home
  • Income Tax
    • Income Tax Return
    • Tax Notice/ Personal consultation
    • Compliance Notice
    • Faceless Assessment
  • GST
    • GST Registration
    • GST Consultation
  • News
    • Income Tax News
    • GST news
    • Budget News
    • Business & Other News
  • Q & A
  • About us
  • Contact us
Talk to an Expert
  • Home
  • Income Tax
    • Income Tax Return
    • Tax Notice/ Personal consultation
    • Compliance Notice
    • Faceless Assessment
  • GST
    • GST Registration
    • GST Consultation
  • News
    • Income Tax News
    • GST news
    • Budget News
    • Business & Other News
  • Q & A
  • About us
  • Contact us
No Result
View All Result
Taxontips
No Result
View All Result

Tax rate of domestic companies slashed/ reduced to 15% and 22% – What’s the truth? – A Summary

Income tax Expert by Income tax Expert
September 23, 2019 - Updated on March 26, 2020
in Budget News
1
Tax rate of domestic companies slashed/ reduced to 15% and 22% – What’s the truth? – A Summary
101
SHARES
1.3k
VIEWS
image_pdfPDFimage_printPrint

On Friday, 20th September, 2019 everyone was ready for some announcement regarding discontinuance of GSTR 9 etc from our Finance Minister Nirmala Sitharam. However, to everyone’s surprise the meeting turned out to be an announcement on change in corporate tax rate in India and the headlines were that Corporate Tax rate has been reduced to 15% for manufacturing company and 22% for non-manufacturing company and also many people have addressed this meeting as a mini budget announcement and the changes made in this meeting has been brought into effect by an ordinance, so let’s discuss the ordinance in brief in this post.

The key highlights of the ordinance are as follows:

  • Title of section 115BA has been changed from “Tax on income of certain domestic companies” to “Tax on income of certain domestic manufacturing companies.”
  • New section 115BAA has been added after section 115BA, where companies would be allowed to pay tax at 22% plus surcharge and cess, if certain conditions are satisfied.
  • New section 115BAB has been added after section 115BA, where companies which are into manufacturing and has been set up after 01st October 2019 would be allowed to pay tax at 15% plus surcharge and cess, if certain conditions are satisfied.
  • Rate of MAT has been reduced from 18.5% to 15% and MAT won’t be applicable on companies covered under section 115BAA and 115BAB.

 

So now technically after above amendment there are in total 5 tax rate for domestic companies in India:

Basic tax rate 15% 22% 25% 25% 30%
Governed by section 115BAB 115BAA 115BA Budget/ Finance Bill Budget/ Finance Bill
Date of incorporation of company On or after 01st October 2019 No date On of after 01st March 2016 No date No date
Limit of turnover No limit No limit No limit Turnover of Rs. 400 crore in FY 2017-18 No limit
Type of Industry/ Company Manufacturing No restriction Manufacturing No restriction No restriction

Few of my concerns with regard to these changes are:

  1. The heading of section 115BA has been changed and now this section has been made applicable only for manufacturing companies and earlier there was no such condition so if any non-manufacturing company had taken it’s benefit will they continue to take such benefit or they have to let go such benefit however according to the proviso of this section once the benefit of this section has been taken it cannot be withdrawn so how will a non-manufacturing company take it’s benefit.
  2. The new manufacturing company will pay tax @15% while the one opened before will pay tax @25% or 30%, why?
  3. Many people spread the news that effective tax rate after considering cess and surcharge in case of two new section i.e. 115BAB and 115BAA would be 17.01% and 25.17% respectively however the calculation of same was not explained and we are not able to reach this tax rate using the regular surcharge rate on domestic companies.

There will be a detailed post with regard to two new sections introduced.

You can read the whole ordinance here: //www.incometaxindia.gov.in/Lists/Latest%20News/Attachments/339/TheTaxation_Laws_Amendment_Ordinance_2019_20_9_19.pdf

 

If you need assistance you can ask a question to our expert and get the answer within an hour or post a comment about your views on the post.

image_pdfPDFimage_printPrint
Tags: corporate tax ratenew corporate tax rate
Previous Post

ICAI provides one time relaxation - Now UDIN can be generated within 30 days instead of 15 days.

Next Post

Section 115BAA - 22% Tax on non-manufacturing Companies (Better than normal 25% tax rate)

Related Posts

Final stage of Union Budget 2023-24 commences with Halwa Ceremony
Budget News

Final stage of Union Budget 2023-24 commences with Halwa Ceremony

January 28, 2023
Guidelines for manual selection of returns for Complete Scrutiny during the financial-year 2019-20-
Income Tax News

Explanatory notes to provisions of Finance Act, 2022 issued by CBDT

November 9, 2022
Guidelines for manual selection of returns for Complete Scrutiny during the financial-year 2019-20-
Budget News

39 more amendments in Finance Bill which was implemented in Finance Act, 2022 received assent of President

April 5, 2022
Last opportunity to file Income tax return for F.Y. 2018-19 | Belated return u/s 139(4) of the Income tax Act
Budget News

How to calculate and pay additional Tax on updated return | Section 140B | Budget 2022

February 11, 2022
Due date for Tax audit for A.Y. 2019-20 extended from 30th September to 31st October
Budget News

Now file updated Income tax return within 2 years from the end of relevant assessment year | Detailed Discussion | Budget 2022

February 9, 2022 - Updated on February 11, 2022
Cryptocurrency bill will be introduced in Parliament to ban other cryptocurrency in India
Business & Other News

INTRODUCTION OF CENTRAL BANK DIGITAL CURRENCY ‘DIGITAL RUPEE’ ANNOUNCED | RBI to issue it from 2022-23

February 2, 2022
Next Post
Tax rate of domestic companies slashed/ reduced to 15% and 22% – What’s the truth? – A Summary

Section 115BAA - 22% Tax on non-manufacturing Companies (Better than normal 25% tax rate)

Comments 1

  1. Pingback: Which companies cannot avail 15% tax rate and pay tax at lower rate: - Taxontips

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Google Custom search

Recent Posts

  • CBDT instructs Income tax officer to complete 148/ 147 assessment before 31.05.2023
  • Final stage of Union Budget 2023-24 commences with Halwa Ceremony
  • Clarification on entitlement of ITC where place of supply is determined in terms of proviso to sub-section (8) of section 12 of the IGST Act
  • Consequences of Accepting cash while selling a Immovable property, land or house | 100% Penalty
  • How many articles can a Chartered Accountant register for articleship?

Recent Comments

  • CBDT instructs Income tax officer to complete 148/ 147 assessment before 31.05.2023 - Taxontips on Instructions issued by CBDT in response to judgement passed by Hon’ble Supreme court in case of notice issued u/s 148 after 01.04.2021
  • CBDT instructs Income tax officer to complete 148/ 147 assessment before 31.05.2023 - Taxontips on Supreme court Judgement on controversial issue of notice u/s 148 issued after 01.04.2021 passed in favor of Revenue | Detailed analysis of full judgement
  • Final stage of Union Budget 2023-24 commences with Halwa Ceremony - Taxontips on What is ‘Halwa ceremony’, performed before the budget at Ministry of Finance? What does it signify? | Pre budget facts
  • Leonard Linton on Clarification for the purposes of Section 269ST of the I.T. Act in respect of dealership/distributorship contract in case of Co-operative Societies
  • Advisory on facility of ‘Initiating Drop Proceedings’ of Suspended GSTINs due to Non-filing of Returns - Update - Taxontips on Advisory on “Initiating Drop Proceeding” by taxpayers for non-filing of GST returns

Categories

  • Budget News
  • Business & Other News
  • Case Laws
  • GST news
  • Income Tax News
  • News

Browse Topics by Date

February 2023
M T W T F S S
 12345
6789101112
13141516171819
20212223242526
2728  
« Jan    
  • GSTR 9/ 9C due date to be extended to 31.10.2020 | E-invoicing will be voluntary in the beginning 79.3k views
  • How to pay Membership and COP fees of ICAI for 2020-21 | 77.8k views
  • Code/ Nature of payment 6CR updated by NSDL in challan 281 for paying TCS on sale of goods 68.1k views

Recent Notification

Guidelines for manual selection of returns for Complete Scrutiny during the financial-year 2019-20-

CBDT instructs Income tax officer to complete 148/ 147 assessment before 31.05.2023

January 30, 2023
Final stage of Union Budget 2023-24 commences with Halwa Ceremony

Final stage of Union Budget 2023-24 commences with Halwa Ceremony

January 28, 2023

RSS Taxontips

  • CBDT instructs Income tax officer to complete 148/ 147 assessment before 31.05.2023
  • Final stage of Union Budget 2023-24 commences with Halwa Ceremony
  • Clarification on entitlement of ITC where place of supply is determined in terms of proviso to sub-section (8) of section 12 of the IGST Act
  • Consequences of Accepting cash while selling a Immovable property, land or house | 100% Penalty
  • How many articles can a Chartered Accountant register for articleship?
  • Advisory on facility of ‘Initiating Drop Proceedings’ of Suspended GSTINs due to Non-filing of Returns – Update
  • ICAI has launched free task management or practice management software for members in Practice
  • Clarification regarding the treatment of statutory dues under GST law [Read circular]
  • Clarifications regarding applicability of GST on certain services based on 48th GST council meeting
  • Clarification regarding GST rates and classification of certain goods based on the recommendations of the GST Council in its 48th meeting held on 17th December, 2022

Categories

  • Budget News
  • Business & Other News
  • Case Laws
  • GST news
  • Income Tax News
  • News

Site menu

  • Home
  • Income Tax
    • Income Tax Return
    • Tax Notice/ Personal consultation
    • Compliance Notice
    • Faceless Assessment
  • GST
    • GST Registration
    • GST Consultation
  • News
    • Income Tax News
    • GST news
    • Budget News
    • Business & Other News
  • Q & A
  • About us
  • Contact us
Taxontips

TaxOnTips provides you all tax related solutions in easy way and update you with its regular updates & notifications Visit us for details.
We are based in Jaipur, India

© 2019-2021 Taxontips.com - Tax assistance at your Fingertips

No Result
View All Result
  • Login/Signup
  • Income Tax
    • Income Tax Return
    • Tax Notice/ Personal consultation
    • Compliance Notice
    • Faceless Assessment
  • GST
    • GST registration
    • GST Consultation
  • News
    • Income Tax News
    • GST news
    • Budget News
    • Business & Other News
  • Q & A
  • About us
  • Contact us
  • Ask an expert/ Talk to an expert
  • Privacy Policy
  • Terms of use

© 2019-2021 Taxontips.com - Tax assistance at your Fingertips

Login to your account below

Forgotten Password? Sign Up

Fill the forms bellow to register

All fields are required. Log In

Retrieve your password

Please enter your username or email address to reset your password.

Log In
Book Phone consultation with expert

Sitting home or at your office and don't have time to visit CA's office or don't know where to consult CA. Book your consultation with an expert practicing Chartered Accountant and get your query solved.

Book a phone consultation for 30 minutes with our expert at a very basic cost.

Book consultation

No thanks, I'm not interested!

ITR 1 to 7 now available for FY 2021-22!!File your ITR with an experienced Chartered Accountant

Now File your Income Tax return for F.Y. 2021-22 with an Experienced Practicing Chartered Accountant and not just with any person like other websites offer. Return filing starts at Rs. 500/-

Book ITR filing with Expert

Never see this message again.

Subscribe for Latest Tax Updates
You name
Yourname@email.com

Never see this message again.