Corporate tax cut
- July 15, 2024
- Posted by: OptimizeIAS Team
- Category: DPN Topics
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Corporate tax cut
Sub: Eco
Sec: Fiscal Policy
Context:
Opposition party alleged that the corporate tax cut has put over Rs 2 lakh crore in the pockets of billionaires, while the middle class continues to bear the weight of heavy taxation in light of CBDT data.
Data released by Central Board of Direct Taxes (CBDT)
As of July, 2024:
India’s net direct tax collection recorded a significant growth of 19.54 % in FY25 to 5.7 Lakh crore.
| Net direct tax collection | Rs 5,74,357 crore |
| Corporation Income Tax | Rs 2,10,274 crore |
| Personal Income Tax | Rs 3,46,036 crore |
Recent Data shows that Individuals are paying more tax than companies
Corporate tax cut
- Corporate tax rates were slashed in September 2019 from 30% to 22% in the hope that it would trigger a private investment boom.
- However, private investment is said to have collapsed from 35% of GDP in 2014 to below 29% in 2024.
Corporate Tax (Corporation tax)
- Direct tax paid by public and private companies registered under Companies Act 1956, on net income or profit.
- Levied on both domestic and international companies.