Corporate tax cuts to kick in from next budget: FM

The Centre will unveil in the next few days a list of exemptions it plans to phase out to reduce corporate tax to 25%, finance minister Arun Jaitley said on Wednesday, and expressed confidence the GST Bill will be passed soon.

The first tranche of cuts would be announced in the Union budget for 2016-17 in February, Jaitley said at the National Strategy Day in India, organised by the World Economic Forum (WEF) and Confederation of Indian Industry (CII) here.

The proposal to cut corporate tax from the current 30% to 25% over a four-year period was part of Budget 2015-16.

“I have announced a road map for direct taxation…to bring down corporate tax down to 25% by phasing out some of those exemptions…We are going to put in public domain in the next few days some of those exemptions that we intend to phase out in the first round,” he said.

The finance minister also said the government has managed to address several legacy issues, including those relating to retrospective tax amendment, though a couple of issues still remain.

“The fear of retrospective taxation has gone...two-three of those problems remain and they remain because of legal reasons,” the minister said, adding the government was working to resolve these as well.

Jaitley also expressed confidence that the much-awaited goods and services tax (GST) bill will be passed soon.

“GST is only a question of time,” he said, a day after indicating that he was willing to speak to Congress leader Rahul Gandhi to end the stalemate over the ambitious tax reforms.

GST, which aims at doing away with more than a dozen state levies to create a single tax regime, was slated to be implemented from April 1 but is stuck in Rajya Sabha where the ruling NDA does not have the required numbers. The bill has already been passed by Lok Sabha.

The finance minister also said there was visible “trickles of growth” in the manufacturing sector.

GST, WHICH AIMS AT DOING AWAY WITH MORE THAN A DOZEN STATE LEVIES TO CREATE A SINGLE TAX REGIME, WAS SLATED TO BE IMPLEMENTED FROM APRIL 1 BUT IS STUCK IN RAJYA SABHA WHERE THE RULING NDA DOES NOT HAVE THE REQUIRED NUMBERS.