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India Slashes CIT For More Taxpayers In 2018 Budget

by Mary Swire, Tax-News.com, Hong Kong

01 February 2018


India's 2018 Budget included proposals to expand the scope of the concessionary rate of corporate income tax, an increase to the tax levied in addition to corporate income tax by one percent, and changes to capital gains tax rules.

From the 2016-17 fiscal year, the turnover threshold for the 25 percent corporate income tax rate will be increased to INR2.5bn (USD39m), up from INR500m. The 30 percent standard rate applies above this threshold. The Government said 99 percent of taxpayers would now pay this 25 percent rate.

The cess on corporate and individual income taxpayers – termed the "Health and Education Cess" – which is levied in addition to personal income tax and corporate tax, was hiked from three percent to four percent.

The Budget also features a proposal to prospectively levy a 10 percent tax on long-term capital gains exceeding INR100,000 earned by equity-oriented funds – those that invest at least 65 percent of funds under management in equity instruments.

The Budget also includes a proposal to exempt the transfer of derivatives and certain securities by non-residents from capital gains tax.

Finally, a concessionary Minimum Alternate Tax rate of nine percent will be available to non-corporate taxpayers operating in the Indian international financial service centers.

TAGS: compliance | tax | business | India | tax incentives | financial services | corporation tax | education | stock exchanges | services | Education | Education | Tax

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