The Finance Ministry is unlikely to tinker with the 10 per cent Minimum Alternate Tax (MAT), the amount companies getting tax exemptions pay on their book profits, despite the industry chambers' demand to reduce the same.
The FM also said the government has proposed a joint panel of Corporate Affairs Ministry and CBDT for incorporation of income computation and disclosure standards.
'Among corporates, about 60% of income is now reported under the new tax regime.'
Finance Minister Nirmala Sitharaman on Sunday proposed to exempt Minimum Alternate Tax (MAT) for non-residents who pay tax on presumptive basis.
The 2026-27 Budget, seeking to harmonise the government's imperative to grant certainty while ensuring a rational tax policy, had several notable announcements to usher in halcyon days, says Mukesh Butani.
This Budget positions India's taxation ideology as not merely a revenue source but as a strategic catalyst for growth, inclusion and long-term confidence.
The revenue department had sent notices to FIIs.
With the Union Budget three months away, major industry chambers have submitted to the government proposals on common taxes, seeking simpler compliance and a quicker resolution of tax disputes.
Budget 2026 sticks to fiscal discipline, shuns populist measures despite five key state elections coming up, but ends up rattling stock markets with a higher transaction tax on derivatives trading.
The contrast with the old Income-Tax Act is stark. The 1961 law ran into 512,000 words; the 2025 one pares that down to 259,000. Chapters have been cut from 47 to 23, while sections have reduced from 819 to 536. One of the clearest changes is terminological. The confusing twin concepts of 'assessment year' and 'previous year' have been scrapped.
Rural India outpaced urban centres in passenger vehicle sales in 2025, recording a growth of 12 per cent compared with 8 per cent in cities.
While the new income tax law replaces the Income Tax Act, 1961 and omits 13 offences, 35 actions and omissions continue to attract criminal liability under 13 provisions.
Ask rediffGURU Naveenn Kummar your insurance mutual fund and personal finance-related questions.
Foreign companies now pay less tax relative to their earnings than at any time in more than three decades. Foreign private companies paid 24.36 per cent of their pre-tax profit as tax in 2023-24, show numbers from the Centre for Monitoring Indian Economy (CMIE).
'If a charitable or religious trust sells a capital asset -- such as land, buildings, shares -- and makes a capital gain, it can avoid paying tax on that gain if it reinvests the proceeds in another capital asset for its charitable purposes.'
'The original provision will be restored. AMT is meant only for those claiming deductions, not for firms earning regular income like capital gains,' a senior government official said.
Bringing some cheer to the industry, Finance Minister Pranab Mukherjee on Monday lowered the surcharge tax limit on corporate tax to 5 per cent from 7.5 per cent, even while marginally raising the Minimum Alternate Tax.
Engineering Export Promotion Council (EEPC) of India has urged the Centre to extend lower corporate tax benefit to Limited Liability Partnerships (LLPs) and proprietary firms as it would make funds available with MSMEs and boost private investment cycle. A body of direct tax professionals also sought for reduction of tax burden on individuals and requested the government to raise the income tax exemption limit at Rs 2.5 lakh to Rs 4 lakh per annum in the upcoming budget for 2022-23 fiscal. EEPC India chairman Mahesh Desai claimed around 84 per cent of small businesses are being denied the benefit of lower corporate tax which was aimed at providing industrial units with more investible surplus.
The draft is in the form of a discussion paper, and has taken radical steps to improvise on the paper released in 2009 on the same issue.
MFs offer scale, simplicity, liquidity, and tax efficiency, and are an excellent vehicle for disciplined SIP investing. PMS is better suited for larger portfolios with equity allocation of Rs 3 crore to Rs 5 crore.
What the Budget could hold in store when it comes to tax rules like GAAR, MAT, PoEM, BEPS and ICDS.
The IT and ITeS sectors expect a reduction in minimum alternate tax (MAT) and dividend distribution tax in the next month's Union Budget, a senior economist said on Tuesday.
Despite similar tax treatment, debt MFs enjoy certain advantages over FDs.
'If the near-term economic pain is absorbed more by those who have the ability and the financial strength to do so, then small and medium enterprises in downstream industries will emerge stronger from the trade imbroglio.'
The fear of losing purchasing power due to inflation and low-interest rates has led many to explore safe alternatives to fixed deposits with high returns
"We are trying to bring the new taxation regime, which can last for another 50 years. Therefore, our endeavour is to see that new taxation system should include the basic features and time tested procedures of existing act, which have survived judicial security over the years."
The proposal to levy a minimum tax based on assets undoes most of the good that the code seeks to do and will discourage capital-intensive industries.
Finance Minister Pranab Mukherjee has announced that Fringe Benefit Tax (FBT) has been abolished. The commodity transaction tax (CTT) has also been abolished. The Goods and Services Tax (GST) will come into effect from April 01, 2010, Mukherjee said.
The government will introduce the Direct Taxes Code by April 2011 after examining thoroughly seven proposals such as taxing savings schemes and clamping the Minimum Alternate Tax (MAT) on gross assets that have not found favour with the industry, trade and people at large.
The levy will be 10%, with an abatement of 50%, effectively bringing down the service tax levy to 5% on the tariff.
Taxpayers are not likely to get as much relief as was proposed in the discussion paper on the Direct Taxes Code last year, with the Finance Ministry saying that the tax slabs may be narrowed down in the bill, slated to be tabled in the monsoon session of Parliament.
Recently, Finance Minister Pranab Mukherjee had assured industry that the government was open to re-examining proposals in seven key areas.
Tax rates would be made known only in the proposed Act, a bill for which will be introduced in Parliament in the coming monsoon session.
Redrafting the Direct Taxes Code is proving to be an uphill task for the finance ministry, bombarded with comments from various stakeholders. The Central Board of Direct Taxes has received about 10,000 suggestions on the code, which seeks to replace the Income Tax Act of 1961.
India is in need of reinsurance capacity for many large risks.
Since we Indians, always look to the west for inspiration, we tried to fish out how India Inc. compares with the US corporations in terms of taxes paid.
Finance Minister has proposed to levy MAT of 18.5 per cent on the book profits of Special Economic Zone developers and units.
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