Skip to main content

SMEs to pay 25% tax even if Rs 50-cr limit crossed in FY17

By
The I-T department today said companies that had a turnover of less than Rs 50 crore in 2015-16 will pay tax at the reduced rate of 25 per cent from April 1 even if they cross the threshold in 2016-17 or subsequent years.
 
Central Board of Direct Taxes (CBDT) chairman Sushil Chandra said the income tax department will come out with a clarification on which companies would be eligible to avail the tax benefit.
 
In order to boost the SME sector, Finance Minister Arun Jaitley in Budget 2017-18 reduced the income tax for smaller companies with annual turnover up to Rs 50 crore to 25 per cent as against the usual rate of 30 per cent.
 
"If your turnover in 2015-16 was Rs 50 crore then you will be subject to 25 per cent tax. We will come out with clarification on (applicability of the tax benefit to) new companies," Chandra said.
 
According to the memorandum to the Finance Bill 2017, in case of domestic company, the rate of income-tax shall be 25 per cent of the total income if the total turnover or gross receipts in the previous year, 2015-16, did not exceed Rs 50 crore.
 
Concerns have been raised whether a company having breached turnover threshold of Rs 50 crore in 2016-17 or 2017-18 would be entitled to concessional tax rate of 25 per cent.
 
A Finance Ministry official said that those companies that had total income of less than Rs 50 crore in 2015-16 can continue to avail the tax benefit even if the turnover has been breached in subsequent years.
 
However, clarity is still awaited on whether the tax benefit would accrue to the new companies which set up business in 2016-17 or in 2017-18.
 
As per data of Assessment Year 2015-16, there are 6.94 lakh companies filing returns of which 6.67 lakh companies have turnover of less than Rs 50 crore and,  therefore, percentage-wise 96 per cent of companies will get this benefit of lower taxation.
 
"This (decision) will make our MSME sector more competitive as compared to large companies. The revenue forgone estimate for this measure is expected to be Rs 7,200 crore per annum," Jaitley had said earlier. PTI JD CS ADI SA
 
 
07TH FEBRUARY , 2017, INDIA TODAY, NEW-DELHI

Comments

Post a Comment

Popular posts from this blog

Credit card spending growth declines on RBI gaze, stress build-up

By
  Credit card spends have further slowed down to 16.6 per cent in the current financial year (FY25), following the Reserve Bank of India’s tightening of unsecured lending norms and rising delinquencies, and increased stress in the portfolio.Typically, during the festival season (September–December), credit card spends peak as several credit card-issuing banks offer discounts and cashbacks on e-commerce and other platforms. This is a reversal of trend in the past three financial years stretching to FY21 due to RBI’s restrictions.In the previous financial year (FY24), credit card spends rose by 27.8 per cent, but were low compared to FY23 which surged by 47.5 per cent. In FY22, the spending increased 54.1 per cent, according to data compiled by Macquarie Research.ICICI Bank recorded 4.4 per cent gross credit losses in its FY24 credit card portfolio as against 3.2 per cent year-on-year. SBI Cards’ credit losses in the segment stood at 7.4 per cent in FY24 and 6.2 per cent in FY23, the...
Post a Comment
Read more

SFBs should be vigilant, proactive to mitigate risks: RBI deputy guv

By
  The Reserve Bank of India’s Deputy Governor Swaminathan J on Friday instructed the directors of small finance banks (SFBs) to be vigilant and proactive in identifying emerging risks in the sector.Speaking at a conference for directors on the boards of SFBs, Swaminathan highlighted the role of governance in guiding SFBs towards sustainable growth with stability. He also emphasised the importance of sustainable business models.Additionally, he highlighted the need for strengthening cybersecurity to protect the entities against digital threats and urged for a stronger focus on financial inclusion, customer service, and grievance redressal to ensure a broader reach of banking services.Executive Directors S C Murmu, Rohit Jain, and R L K Rao, along with other senior officials representing the Supervision, Regulation, and Enforcement Departments of the RBI, also participated in the conference.   -  Business Standard  30 th  September, 2024
Post a Comment
Read more

Brigade Hotel Ventures files draft papers with Sebi for Rs 900 crore IPO

By
  Brigade Hotel Ventures Ltd, owner and developer of hotels in South India, has filed draft papers with capital markets regulator Sebi to raise Rs 900 crore through an initial public offering (IPO).The proposed IPO is entirely a fresh issue of equity shares with no Offer-for-Sale (OFS) component, according to the draft red herring prospectus (DRHP).Proceeds from the issue to the tune of Rs 481 crore will go towards payment of debt, Rs 412 crore will be allocated to the company and Rs 69 crore to its material subsidiary, SRP Prosperita Hotel Ventures Ltd.Additionally, Rs 107.52 crore will be used to purchase an undivided share of land from the Promoter, BEL, and the remaining funds will support acquisitions, other strategic initiatives, and general corporate purposes.The company may raise up to Rs 180 crore through a Pre-IPO Placement.   If the placement is undertaken, the issue size will be reduced.Brigade Hotel Ventures Ltd is a wholly-owned subsidiary of Brigade Enterprises ...
Post a Comment
Read more