Latest Expert Exchange Queries
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
 
 
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
 
 
 
 
Popular Search: due date for vat payment :: VAT Audit :: cpt :: articles on VAT and GST in India :: VAT RATES :: ACCOUNTING STANDARDS :: TAX RATES - GOODS TAXABLE @ 4% :: Central Excise rule to resale the machines to a new company :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: empanelment :: list of goods taxed at 4% :: ACCOUNTING STANDARD :: form 3cd :: ARTICLES ON INPUT TAX CREDIT IN VAT :: TDS
 
 
News Headlines »
 Are multiple service tax rates in the offing?
 All you need to know about claiming tax break on HRA
 How much income tax you should pay on investments in gold?
  Best ways to save tax in 2017
 8 unknown stocks that could yield huge returns
 Government may set threshold for probe into deposits to prevent harassment of taxpayers
 How to calculate capital gains tax
 April 1 still the target for GST: FM
 How to respond to CBDT’s tax compliance notice
 Goods & Services Tax (GST)(As On 01-01-2017)
 Excise, service taxpayers to migrate to GST portal by January 31

Tax rates to dip, firms to pay more
August, 19th 2009

On the face of it, the recently proposed Direct Taxes Code is set to bring down corporate tax rates, but in effect, the government could well end up earning more revenue than it does now. That is because a set of exemptions that effectively reduce current tax rates will vanish under the code.

The Centre had foregone taxes amounting to Rs 68,914 crore in 2008-09 because of a plethora of exemptions. The code proposes that corporate income tax rate should be brought down to 25 per cent.

At present, firms are charged at the rate of 30 per cent and then slapped a 10 per cent surcharge and an education cess on top, together taking the taxation rate to nearly 34 per cent.

According to a Finance Ministry official, the effective rate of taxes paid by firms currently is 22.24 per cent after netting out the exemptions, based on a study of the actual tax paid.

The official said the income tax department had received 4,10,451 corporate returns filed electronically until March 31, 2009, which were studied.

The effective tax rate of the entire sample was 22.24 per cent, which was substantially lower than the statutory tax rate of 33.99 per cent, the official said.

Importantly, the effective tax rate for private companies were lower at 21.28 per cent as compared to government-owned companies that paid an effective tax rate of 25.69 per cent.

The tax code, which has proposed reducing the tax rate to 25 per cent, is predicated on the Laffer curve principle that says lower rates with a higher base of tax payers tends to increase revenues.

For many decades, the tax base has been eroded through a steadily escalating range of exemptions, the code says.

 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2017 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Binarysoft Technologies - Contact Us

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions