Nirmala Sitharaman Says Corporate Tax For Companies To Be Cut Gradually

Finance Minister Nirmala Sitharaman said corporate tax rate for companies with over Rs 400 crore turnover will be gradually cut to 25 percent and the government will support wealth creators.

Speaking at an industry event, Sitharaman said the corporate tax reduction for the rest of corporates would be gradual.

She did not give a timeframe for the reduction.

In her maiden Budget last month, she had cut corporate tax for companies with annual turnover of up to Rs 400 crore to 25 percent from 30 percent earlier.

Last year, the then Finance Minister Arun Jaitley had cut the corporate income tax rate to 25 percent for companies with a turnover of up to Rs 250 crore.

Echoing Prime Minister Narendra Modi’s Independence Day speech, SItharaman said Indian entrepreneurs will be given all kind of support.

"I would like to underline the fact that we are conscious of that the Indian entrepreneurs are the ones who have been the wealth creators, job creators of this country...we are proud of them and we shall keep supporting them. Every attempt of the government will be towards promoting them, to understand them and also to facilitate them," she said.

"Only 0.7 percent are left... Even for them gradually, hopefully in the long run, we will be able to bring down the tax to the level of 25 percent," she added. She did not give a time-frame for the reduction.

That is the spirit with which many of the things have been announced and that is why the corporate tax was brought down, she added.

Modi had in his annual Independence Day address to the nation on Aug. 15 had extolled the role of wealth creators and said they must not be viewed with suspicion.

"Indian wealth creators, entrepreneurs should be extended all kinds of support and tax is one of the foundations ... we should have more facilitating rates rather than suffocating rates of taxation. We are doing many such things," Sitharaman said. With regard to tax administration, the Finance Minister said tax administrators become facilitators and people who pay tax are treated with a lot of understanding.

To achieve this objective, she said the ministry has decided to hold meetings of tax administrators across various Tier II cities in the country.

“Let us never see wealth creators with suspicion. Only when wealth is created, wealth will be distributed,” he had said. “Wealth creation is absolutely essential. Those who create wealth are India's wealth and we respect them.”