Existing Taxation Structure For Corporate Very Reasonable: Revenue Secretary

NEW DELHI: The existing taxation structure for corporates with a 22 per cent tax is “very reasonable” when compared to an economy of the size of India and hence the concessional tax regime which was in force for four years for new manufacturing units was not extended beyond March 2024, Revenue Secretary Sanjay Malhotra said.

“In an interview with PTI, Malhotra said the Interim Budget 2024-25 provides for continuity in taxation regime and the benefits given to taxpayers in the last years are showing results in the form of huge buoyancy in personal income tax.

“”Taxpayer services have been a major focus of the government and this will continue going forward. Taxpayer services includes rationalisation, simplification and trust-based taxation with less scrutiny and more pinpointed assessments and use of technology. We are hopeful taxpayer services will continue to improve helping us in compliance and improving tax collection efficiency,” Malhotra said.

“To a question on why the concessional tax regime for corporates was not extended beyond March 31, 2024, Malhotra said the scheme was introduced in 2019 and companies were given a long time to set up new units to avail of the concessional 15 per cent rate of tax.

“”A long period of four years was given. This is the time that a large company put on the ground right from conceptualisation, planning, raising of funds, sufficient time was given it was extended by another year till March 31, 2024, because of Covid. These investments have a long gestation period.

“”The existing taxation of our country now for corporates at 22 per cent, when compared to the economy of our size, is very, very reasonable. In light of all these, it was felt that this was the date that it was to sunset and it should sunset,” Malhotra said.

“The government in 2019 announced that any new domestic company incorporated on or after October 1, 2019, making fresh investment in manufacturing, will have the option to pay income tax at the rate of 15 per cent if they commenced their production on or before arch 31, 2023. The date was extended till March 31, 2024, in the Budget presented on February 1, 2023.

With Inputs from PTI.

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