The removal of 10 per cent surcharge on direct taxes to cost Rs 10,034 crore.
All subsidies will be eliminated by March 2018
Across 10 prominent services, revenue to the government reduced by 20 per cent in the first year of GST compared to the last year of the service tax regime. This happened despite tax liability against these services growing by 50 per cent in one year.
The tax rates for Indian firms, including surcharge, education cess and a fringe benefit tax ranging between four to six per cent amounts to 38 per cent. This again is without considering the dividend distribution tax which Indian firms are liable to pay on dividends declared.
One category which stands out is fixed maturity plans due to its tax benefits, notes Prateek Mehta, CEO and company-co-founder, Upwardly.in.
Investing in debt instruments requires careful attention.
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.
NSC scores high on all three parameters that conservative investors are seeking -- safety, tax-adjusted returns and liquidity.
The GST Bill, seen as single biggest tax reform in a long time, needs to be ratified by at least 15 state legislatures before the President can notify the GST Council which will decide the new tax rate and other issues
Indian industry put forth its demands for cut down on income and corporate tax rates in a pre-budget consulatation meet.
One of India Inc's top demands is the abolishing of the MAT.
Arun Jaitley had a tough fiscal hill to climb.
Most investments by Indian corporate houses in the overseas market is through countries that have either low tax rates or allow tax-free remittance of income. Much of the outward foreign direct investment (FDI) by India Inc done between April and December 2007 was directed to Singapore, the Netherlands and British Virgin Islands (BVI), according to the latest Reserve Bank of India data. RBI said the actual outward FDI in April-December 2007 grew 13 per cent at $10.11 billion.
The government is expected to announce the second stimulus package in the next three days.
The Centre and the state governments have agreed not to unilaterally change the tax rate on goods and services, once the Goods and Services Tax (GST) is implemented from April 2010.
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