The country has been experiencing slow economic growth and an increase in unemployment. Hence to provide fiscal relief for companies to boost investments, generate employment, the Union Minister for Finance & Corporate Affairs Nirmala Sitaraman announced corporate tax cut for domestic and new domestic manufacturing companies.
According to The Hindu, the effective tax rate for domestic corporates, inclusive of surcharges, will fall from 34.94% to 25.17% if they stop availing any other tax sops. For new manufacturing firms set up after October 1, 2019, and commencing operations by March 31, 2023, the effective tax rate will fall from 29.1% to 17%.
Reduction in corporate taxes is a good move towards globalising India’s economy. Not just stability, speed is equally important for an economy that needs to serve 1.3 billion people. -Sg @nsitharaman @EconomicTimes @FinMinIndia @ianuragthakur @IshaLeadership #CorporateTax
— Sadhguru (@SadhguruJV) September 21, 2019
It was early Diwali for Indian companies as she slashed the tax rate for corporates. People went gaga over the tax relief and flooded Twitter with interesting memes.
reduction in #Corporatetax
Sensex :#corporatetaxcut #sensex pic.twitter.com/1HD2WGuWGz
— CHEEKU 🌼 (@Okay_Bye___) September 20, 2019
https://twitter.com/sehgal_tweets/status/1174957214668165122?ref_src=twsrc%5Etfw%7Ctwcamp%5Etweetembed%7Ctwterm%5E1174957214668165122&ref_url=https%3A%2F%2Fwww.latestly.com%2Fsocial-viral%2Ffunny-sensex-memes-take-over-twitter-after-markets-zoom-following-nirmala-sitharamans-corporate-tax-cut-announcement-1209847.html
#OneindiaCartoons | Amid economic slowdown, markets roared back to life on Friday with equity indices skyrocketing over 1,900 points. #CorporateTax #EconomyRises
more details: https://t.co/xsjbR9Mv4g pic.twitter.com/0YBWZ8iG69
— Oneindia News (@Oneindia) September 21, 2019
Sensex and Nifty right now.#Corporatetax pic.twitter.com/IR3hcoQCWI
— Roastyourself (@niimz94) September 20, 2019
Suddenly #NirmalaSitharaman ji is looking prettier than #KatrinaKaif to #investors and #Corporate
😄😄😄 #CorporateTax #corporatetaxcut pic.twitter.com/eijEkaQGub
— manishbpl (@manishbpl1) September 21, 2019
https://twitter.com/Jk42154007/status/1174935454363217920?ref_src=twsrc%5Etfw%7Ctwcamp%5Etweetembed%7Ctwterm%5E1174935454363217920&ref_url=https%3A%2F%2Fwww.latestly.com%2Fsocial-viral%2Ffunny-sensex-memes-take-over-twitter-after-markets-zoom-following-nirmala-sitharamans-corporate-tax-cut-announcement-1209847.html
Pic 1 :*stock holder when #Sensex down
Pic2: *stock holder when #Sensex rises over 2200 point in one day#CorporateTax #NirmalaSitharaman pic.twitter.com/8oOinhjq5A— Lumcky 🐇 (@the_lucky420) September 20, 2019
Stock brokers. #corporatetax pic.twitter.com/YePRV6E6IG
— Puneet (@OnestoPuneet) September 20, 2019
Chamchas and Congressi after Finance Minister's #Corporatetax cut announcement and #Sensex Highest gain in the 10 years pic.twitter.com/7JiX1hGLC4
— Sonam Mishra (@notsecular212) September 20, 2019
#Corporatetax Meanwhile Eicher Motors Shareholders be like. pic.twitter.com/hybU5WyX0t
— Raj K. Bansal (@SurnameChokidar) September 20, 2019
NDTV right now#FinanceMinister #Sensex #Corporatetax pic.twitter.com/4F79vtuVxR
— ma name is sanghi (@bagga_daku) September 20, 2019
#Corporatetax cut.#Sensex and Market: pic.twitter.com/zGZ9sAsfZ6
— Pulkit (@voxxpopli) September 20, 2019
*Stock holders after earning lakhs of rupees*#Sensex #Corporatetax pic.twitter.com/DwE1LLTVBD
— Tweetera🐦 (@DoctorrSays) September 20, 2019
Domestic companies after reduction in #CorporateTax : pic.twitter.com/YzIJu4G4f2
— Ravi Rawat (@RaviRawat737) September 20, 2019
Some even criticised the move:
FM : #CorporateTax cut
Middle class: pic.twitter.com/R2AP9QZC6y
— Sleeping (@urbanXpunjabi) September 20, 2019
Discussion in the Government –
What's wrong with the Economy?
There's no demand. Plants are closing down. There is excessive capacity in relation to the demand. What do we do?Solution: Corporates need more money to invest and increase their capacity.#CorporateTax pic.twitter.com/6mATqgM17p
— SUЯΞИDΞЯΞD PЯΞ💤 (@PrezzVerde) September 21, 2019
Individual tax – 30%
Corporate tax – 22%Naaaachooo 😂 🕴️#CorporateTax #Corporatetaxcut
— Samar Husain 🇮🇳 (@samarhusain1) September 21, 2019
https://twitter.com/iChandrusekar/status/1175282066725822465
For the uninitiated, corporate tax or company tax is a direct tax imposed by the central government on the net income of the company wherein both public and private companies (registered under the Companies Act 1956) are liable to pay taxes to the government.
What do you think of this sudden bonanza given by the government?