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"PM MODI HISTORIC CORPORATE TAX CUT, TO LOWEST IN ASIA, REVIVES INDIA ECONOMY, WILL POUR $1 TRILLION FDI, CREATE CRORE NEW JOBS"
 
 
PRIYADARSHINI SIDDHARTHA REDDY
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  PM MODI HISTORIC CORPORATE TAX CUT, TO LOWEST IN ASIA, REVIVES INDIA ECONOMY, WILL POUR $1 TRILLION FDI, CREATE CRORE NEW JOBS  
 
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PM MODI CUT OF CORPORATE TAX REVIVES ECONOMY
MODI DROPS CORPORATE TAX TO ASIA’S LOWEST
CORPORATE TAX CUT WILL POUR $ 1 TRILLION FDI
Sample 1
MODI CORPORATE TAX CUT CREATES CRORES JOBS.
CORPORATE TAX CUT RISES INVESTOR WEALTH,
 BY Rs 7 TRILLION IN ONE DAY, ON 20 SEP 2019

 By: PRIYADARSHINI SIDDHARTHA REDDY
 
 CHAIRMAN BOARD OF EDITORS
 politicsparty.com
 sidredbuzz@gmail.com
 21 September 2019
 

MODI CUTS CORPORATE TAX & REVIVES ECONOMY


Prime Minister Narendra Modi Government 's announcement has revived the Economy and begun the Historic Boos of the India Manufacturing Industry on 20 September 2019 by Cutting the Corporate Tax in India to the Lowest in Asia and will Now pour in the Trillion Dollars of Foreign Direct Investment into India Industry to create Crores of New Jobs.



MODI DECISION TO CUT CORPORATE TAX REVIVES ECONOMY


Prime Minister Narendra Modi CUT of the Corporate Tax on 20 September 2019 has Begun the Process of the Instant Revival of the India Economy, generating Billions of Dollars of Investment and Creating Lakhs of New Jobs.


Prime Minister Narendra Modi announced the Historic Huge Economic Reform by cutting the Corporate Tax on Existing Companies to 22%.


Prime Minister Narendra Modi announced the Historic Huge Economic Reform by cutting the Corporate Tax on New Companies launched from 1 October 2019 to 15 %.


Prime Minister Narendra Modi Decision to Cut the Corporate Tax will inspire Most of the Multi National Companies to begin setting up New Factories in India to manufacture their Products, as they will make greater Profits by paying ONLY 15% as Corporate Tax.


Prime Minister Narendra Modi Decision to Cut the Corporate Tax will give the Gigantic Boost to the Make-in-India Process with thousands of New Factories being Launched from 1 October 2019.


Prime Minister Narendra Modi Decision to Cut the Corporate Tax will Pour Billions of Foreign Direct Investment into the Manufacturing Companies in India,creating Lakhs of New Jobs.


Prime Minister Narendra Modi Decision to Cut the Corporate Tax will increase the Value of the Shares in all the Companies creating more than Rs 100 Trillion in Increased Wealth for the Shareholders holding Shares in the Indian Companies.


PM MODI DECISION TO CUT CORPORATE TAX IS BOOSTING INDIA ECONOMY: UNDER LISTED ARE DETAILS FROM VARIOUS SECTIONS OF MEDIA


Domestic equity benchmark BSE Sensex vaulted 1,921 points on Friday, fuelled by a slew of economy-boosting measures announced by the Prime Minister Narendra Modi Government.

Logging its biggest intraday spike in over a decade, the 30-share index soared 2,284.55 points to a peak of 38,378.02, before settling 1,921.15 points or 5.32 per cent higher at 38,014.62.

Similarly, the broader NSE Nifty zoomed 569.40 points or 5.32 per cent to end at 11,274.20.

Bulls took over the market after the government slashed corporate tax rates for companies by almost 10 percentage points to 25.17 per cent to bring them on par with Asian rivals such as China and South Korea.

Prime Minister Narendra Modi Government will not levy the enhanced surcharge introduced in the Budget on capital gains arising on the sale of equity shares in a company liable for securities transaction tax.

Additionally, the super-rich tax will not apply on capital gains from the sale of any security, including derivatives in hands of foreign portfolio investors.

In another relief, Prime Minister Narendra Modi Government. said listed companies which had announced a buyback of shares before July 5 would not be charged with the super-rich tax.

“Markets gave complete thumbs up to the decision as it is expected to give much room for corporate India to reinvest the money into building capacity and fuel growth for the long term while providing immediate support to its waning earnings in the near term,” 

The Sensex and Nifty clocked their highest one-day gains in over a decade on the back of the announcements.

Top gainers in the Sensex pack included Hero MotoCorp, Maruti, IndusInd Bank, Bajaj Finance, SBI, M&M, HDFC Bank, HUL and L&T, rallying up to 12.52 per cent.

On the other hand, PowerGrid, Infosys, TCS, NTPC and Tech Mahindra ended in the red, losing up to 2.39 per cent.

The rupee too appreciated 29 paise to 71.04 against the US dollar following the finance minister’s announcements.

In the fourth set of packages for the industry, the Prime Minister Narendra Modi Government on Friday 20 September 2019 announced corporation tax rate cuts for companies not availing of any exemptions and setting up manufacturing facilities in the country from the next month.

Prime Minister Narendra Modi Government on Friday 20 September 2019 announced doing away with surcharge announced in the Budget for the capital markets.

The measures will hit the exchequer by Rs 1.45 trillion a year amid the already grim situation, but the finance minister said the cut in taxes also expands the basket.

Prime Minister Narendra Modi Government announced that the corporation tax rate has been cut to 22 per cent from 30 per cent for companies not availing the benefits of exemptions. Currently, the total tax burden after surcharges and cesses come to about 34.94 per cent, which has been reduced to 25.17 per cent or about ten percentage points.

The companies which are enjoying exemptions and tax holidays and are not willing to join the new tax regime can do so after sun set clause on their tax breaks kicks in. However, once they come to the new tax regime, they have to stay there.

Companies incorporated from the next month and starting production before March 31, 2023 would get reduction in corporation tax rate from 25 per cent to 15 per cent. With cess and surcharges this comes to 29.12 per cent at present and with new rate structure that would be cut to 17.01 per cent or about 12 percentage points. These companies also need not pay any minimum alternate tax (MAT).

The Prime Minister Narendra Modi Government also reduced the minimum alternate tax (MAT) to 15 per cent from the current 18.5 per cent. With cess and surcharge this comes to 21-22 per cent at present, which will be reduced to 17 per cent.


Prime Minister Narendra Modi Government to give a boost to the capital markets, announced that enhanced surcharge will not apply to capital gains on sale of equity or units in equity oriented trusts.

Also, tax on buy back will not be charged for those companies making this announcement before July five this year.

The Prime Minister Narendra Modi Government also expanded the scope of corporate social responsibility to include incubators funded by the Centre or state governments, public sector units and making contribution to public-funded research institutions and universities such as ICAR, CSIR and ICMR.

All the tax measures have been announced through an ordinance promulgated today to amend the Income Tax Act, 1961 and the Finance Act, 2019.


MODI REDUCES INDIA CORPORATE TAX TO LOWEST IN ASIA


Prime Minister Narendra Modi Government reduction in the India Corporate Tax rate to now be among Asia’s lowest was welcomed by investors as a boon that may help spur economic growth and company profits.

The effective corporate tax rate for all domestic companies will be 25.2%, lowered from 30%, the government announced Friday. That reduces it to the same level as Singapore.

“This move means concerns on India are quite well covered for the time being,” said Felix Lam, Hong Kong-based senior Asia Pacific equities fund manager at BNP Paribas SA. “We have to now see what companies do in terms of investments and what consumers do in terms of spending.”

The benchmark Sensex Index headed for its biggest gain in a decade, climbing as much as 6.3% after the unexpected reduction. The gains wiped out a year-to-date loss that had triggered a so-called correction Thursday as the gauge registered a 10% drop from a record high touched in June. Foreign investors had sold $4.9 billion of local stocks this quarter through Sept. 18, which would be the biggest quarterly outflow since 1999.

“As well as providing instant EPS upgrades, these tax cuts should provide a boost to business confidence and investment and will create a tailwind for Indian equity performance for the remainder of the year,” said Ross Cameron, head of Northcape Capital Ltd.’s Japan office in Tokyo. “India remains the best long-term growth story in EM but the economy has clearly slowed recently.”

The tax cut, retrospective from April 1, will cost the government 1.45 trillion rupees ($20.5 billion) in revenue. It’s the latest in a series of measures rolled out in recent weeks aimed at boosting demand and investments after economic growth slowed to a six-year low in the April-June quarter.

“We already had quite a positive view on the country’s equities market so we will stay invested,” Lam said. “India now needs to create more jobs to make it further better.”

The measure may spur more investors to buy Indian stocks, according to Citigroup Inc.

“Expect this rally to have more legs with follow through buying next week, especially after India’s under-performance and foreign outflows recently,” a Citigroup note said. “There are still several people out there worried about any negative fine print which could come later but this does look straight-forward and genuine.”

MODI CUT OF CORPORATE TAX BOOMS INDUSTRY

With the Prime Minister Narendra Modi Government  reducing the corporation tax rates, industry leaders say the measures would increase investments, spur demand and encourage MNCs to shift their manufacturing units to India, as new factories will attract tax rates of only 15 per cent.

“This is an excellent move to bring back confidence and will boost investment by corporates. It is a real game-changer and the government should revisit personal taxation as well,” TVS Motor Chairman Venu Srinivasan said soon after the Prime Minister Narendra Modi Government made the blockbuster announcement in Goa.

The Finance Minister said the corporation tax rate for existing firms has been cut to 22 per cent now from 30 per cent with effect from April 1, 2019. This brings down the effective tax rate, inclusive of surcharges, for companies to 25.1 per cent. At the same time, the corporate tax rate for new manufacturing firms registered after October 1 is slashed to 15 per cent from 25 per cent. The effective tax rate, inclusive of surcharges, for these companies, will now be 17 per cent.

This benefit is available to companies that commence production on or before March 31, 2023. With this, the new tax rates now bring India broadly into line with those in the Southeast Asian countries (See Table).

Today’s announcements will also encourage multinationals to shift their plants to India, as the government announced that it would tax them at a lower rate of 15 per cent. Among the large players, Apple is planning to invest in a new plant to make Apple products like iPhones.

Gopichand Hinduja, Co-Chairman of Hinduja Group said the current reduction in corporate tax was needed for the revival of the Indian economy and manufacturing sector. “It shows the government is well seized of the economic challenges facing all of us. I only wish more such steps could be taken together in one go like tapping NRI investments to create deeper impact, instill more confidence in economy and among corporates. This would certainly help put businesses back on track, generate more employment and most importantly, keep India as the principal investment destination amidst global slowdown,” he said.

"The tax rate cuts come at the right time before festive season and will spur investments and create jobs. The tax cuts will boost consumption sentiment before a three-month-long festive season that starts next month,” Housing Development Finance Corp Ltd CEO, Keki Mistry said.

“It will also help boost growth over the next two-three quarters and the steps will boost corporate profitability, dividend payment ability," he added.

India’s move to cut corporate tax rate will help companies do a lot of things to increase demand for automobiles, which was witnessing an unprecedented decline,” R C Bhargava, chairman of Maruti Suzuki India Ltd said. “While the cuts won’t increase demand from customers, it’s possible to look at pricing policies,” he said.

“The Prime Minister Narendra Modi Government’s mega corporate tax stimulus is a major move to boost investors sentiments, encourage manufacturing and awaken animal spirits in the economy. The cut in corporate tax from 30 per cent to 22 per cent without exemptions has been a long standing demand of industry and is an unprecedented and bold move by the Government,” said Vikram Kirloskar, President, CII.

Indian Corporation Tax rate vs Asian peers

India: 25.2%

Japan: 30.6%

South Korea:25%

China:25%

Indonesia: 25%

Malaysia: 24%

Vietnam: 20%

Thailand: 20%

Singapore: 17%

Hong Kong:16.5%

Neeru Ahuja, partner, Deloitte said, “We should see higher investment flows coming into India as net return to investors will be very attractive now.” According to him, effective corporate tax rate of about 35% coupled with dividend distribution tax rate of about 20% was becoming uncompetitive as return on investment was low.

“Reducing the corporate tax rate and for new entrants setting up manufacturing units is a big boost. It has two important effects. One the domestic environment which was sluggish due to slowdown is going to fade with lowered corporate taxes and second the Make in India will see a boost as well,” said Mustafa Nadeem, CEO, Epic Research.

According to Ajay Bodke, CEO, PMS Prabhudas Lilladher, the measures will attract hundreds of billions of dollars of FDI & FII flows over the medium term.

PM MODI CUT OF CORPORATE TAX GIVE STOCK MARKET BEST DAY IN 10 YEARS SINCE 2009


Indian shares notched their best day in more than a decade after the Prime Minister Narendra Modi Governmentannounced deep cuts in corporate taxes to revive flagging growth in Asia's third-largest economy.

Prime Minister Narendra Modi Government said the effective corporate tax rate would be lowered to around 25% from 30% and scrapped the minimum alternative tax for domestic companies.

Both the broader NSE index and the benchmark BSE index closed 5.3% higher, finishing the week with gains of more than 1.5%.

The rupee, which rose as much as 0.9% to 70.68 against the dollar after the announcement, pared some gains to trade at 71.05 by 1015 GMT.

"The markets have been asking for a big fiscal stimulus and the government has delivered," said Rusmik Oza, head of fundamental research at Kotak Securities in Mumbai.

Corporate earnings may see an almost 12% jump in the next quarter for full tax paying companies due to the cut, and the markets can go up nearly 10%, Oza said, adding that foreign investors would cheer these measures.

The tax break is the latest in a raft of measures from the government to lift the economy after growth hit a six-year low in the April-June period, mainly dragged by a slump in private investment.

"The measures announced by the finance minister this morning can be described as a 'New Deal' for the Indian economy," said VK Vijayakumar, chief investment strategist at Geojit Financial Services. "The psychological stimulus from this ... will be higher than the fiscal stimulus."

Economists believe that the cuts would make India competitive for investment, as it brings corporate tax rates on par with other Asian economies.

The Reserve Bank of India Governor Shaktikanta Das said the moves augur "extremely well" for the economy.

Prime Minister Narendra Modi Government said total taxation revenue loss due to the cuts would be about $20.5 billion, raising concerns that the government may not be able to meet its fiscal deficit target for 2019-20 at a time when tax revenue collections are already weak.

Speculation that the Prime Minister Narendra Modi Government may have to borrow more to meet its expenditure needs for the year saw the benchmark 10-year bond yield spike to a 2-1/2-month high of 6.87%, before trimming some gains to trade at 6.8%.

Governments and central banks around the world have been loosening monetary and fiscal policies to revive economic growth, hurt mainly by the ongoing US-China trade war and weak consumer demand.

Stocks of automakers were among the top gainers on the local indexes. The Nifty Auto index jumped 9.9%, with Eicher Motors Ltd and Hero MotoCorp Ltd climbing over 13% each.

Top lenders ICICI Bank Ltd and HDFC Bank Ltd soared 8% and 9%, respectively, sending the Nifty Bank index up 8.3%.



PM MODI CUT OF CORPORATE TAZ ZOOMED INVESTOR WEALTH TO Rs 7 TRILLION IN ONE DAY ON 20 SEP 2019

Investor wealth on Friday zoomed a whopping Rs 6.82 trillion in single day as equity markets rallied, with the Sensex skyrocketing 2,284 points in intra-day trade, following a slew of economy-boosting measures announced by Prime Minister Narendra Modi Government 

The 30-share key BSE index saw a hike by 1,921.15 points or 5.32 per cent to close at 38,014.62. During the day, it advanced 2,284.55 points to 38,378.02, its biggest intra-day spike in over a decade.

The bull market led the market capitalisation of the BSE-listed companies to soar Rs 6,82,938.6 crore to Rs 1,45,37,378.01 crore in a single day.

The Prime Minister Narendra Modi Government on Friday slashed the corporate tax rate for companies by almost 10 percentage points to 25.17 per cent and offered a lower rate to 17.01 per cent for new manufacturing firms to boost economic growth rate.

"Today's measures, without exaggeration, have revived the sagging economic situation and has reinfused the "Josh" among the corporate and capital market fraternity. Apart from the benchmark indices correcting, it was more to do with the sentiment which was hitting new lows day after day. That seems to be dealt with by daring to cut corporate tax, which clearly has a positive impact on the earnings," Devang Mehta, head (equity advisory) of Centrum Wealth Management, said.

In the fourth phase of post-budget economic stimulus measures, Prime Minister Narendra Modi Government cut base corporate tax for existing companies to 22 per cent from the current 30 per cent; and for new manufacturing firms, incorporated after October 1, 2019, and starting operations before March 31, 2023, to 15 per cent from the current 25 per cent.

Prime Minister Narendra Modi Government also said no tax will be charged on share buyback by listed companies that announced such a move prior to July 5.

Also, super-rich tax by way of enhanced surcharge on income, announced in the July 5 Budget, will not apply to capital gains arising on equity sale or equity-oriented funds liable to securities transaction tax (STT) with a view to stabilise flow of funds into capital markets.

"The biggest event of the week was the cut in corporate tax rates as announced by the  Prime Minister Narendra Modi Government. This is a huge step in boosting the overall profitability of corporate India.

"This step, along with some other measures announced including the enhanced tax surcharge introduced in July 2019 to not apply to capital gains on sale of equity share which is subject to STT, would go a big way in restoring confidence in the Indian equity markets," said Shibani Kurian, senior vice-president and head of equity research, Kotak Mahindra Asset Management Company.

Religare Broking Ltd Vice-President (Research) Ajit Mishra said it turned out to be a historic session for equity markets as Nifty gained over 5 per cent. Participants rejoiced the announcements made by the  Prime Minister Narendra Modi Government to boost the economy and market sentiments, wherein the cut in corporate tax turned out to be the catalyst.

The announcements came just in time as markets were reeling under tremendous pressure, citing weak domestic sentiments and not-so-encouraging global markets, Mishra added.

From the BSE 30-share basket, 25 scrips closed with hefty gains led by Hero MotoCorp, Maruti Suzuki India, IndusInd Bank, Bajaj Finance, State Bank of India and Mahindra & Mahindra and zoomed up to 12.52 per cent.

On the BSE, 1,864 scrips advanced, while 728 declined and 144 remained unchanged.

Sectorally, the BSE auto, bankex, capital goods, consumer durables, finance, energy, oil and gas, metal and telecom indices rallied up to 9.85 per cent.

In the broader market, the BSE Midcap and Smallcap indices also rose by up to 6.28 per cent.




Prime Minister Narendra Modi Government announced a slew of measures on Friday to revive sagging investment in Asia's third-largest economy, including a cut in corporate taxes.

Prime Minister Narendra Modi Government a news conference that the effective corporate tax rate will be lowered to 25.75 per cent from 30 per cent.

A. Prasanna, Head of Research, ICICI Securities Primary dealership Pvt Ltd

"This is a long overdue and hugely positive move by the finance minister. Nearly 50 per cent of the companies were paying effective tax rate of below 30 per cent under current rules. The new rates simplify the tax architecture and will give a fillip to investments and jobs. This is the first concrete step towards realising Make in India."

"The fiscal impact will be large, but right now the need for economic recovery should take priority. I expect the RBI to accommodate this fiscal expansion via additional open market operations to keep interest rates in check."

Mahendra Kumar Jajoo, Head of  Fixed Income, Mirae Asset Global Investments

"On one side is the reality that 1.45 trillion rupees is sacrificed. On the other side is the hope that it will be recovered through economic recovery."

"This kind of a revenue recovery will be pretty challenging. So right now, it is negative for bonds and positive for equity markets."

Ajay Bodke, CEO PMS, Prabhadus Lilladher

"In a major boost to revive flagging animal spirits and position India as one of the most attractive business destinations, the government has announced a slew of measures that would act as a force multiplier for the flagging economic engine. By slashing corporate tax rate to 25 per cent from 35 per cent (22 per cent from 30 per cent without exemptions) for existing domestic companies and an extremely attractive rate of 15% for new companies setting up manufacturing operations after Oct. 1, 2019 and commencing operations before 2023, the government has rolled out a red carpet that would ensure hundreds of billions of dollars of FDI and FII flows over the medium term."

PM MODI CUT OF CORPORATE TAX OPENS CUT IN GST


All eyes are on the Goods and Services Tax (GST) council's meeting in Goa after the government slashed corporate taxes, aiming to reviving private investment and lifting growth from a six-year low that has caused job losses and fueled discontent in the countryside.


Domestic companies will pay 22 per cent tax on their income from April 1, 2019, versus 30 per cent previously, said the Prime Minister Narendra Modi Government. 

 

The effective rate, including all additional levies, will be 25.2% and applicable on companies that aren't availing any incentives or exemptions.


Prime Minister Narendra Modi Government 's announcements and the GST council's meeting comes at a time when India's annual economic growth fell to a 25-quarter low of 5% in April-June period.


FINISHLINE


Prime Minister Narendra Modi Government 's announcement has revived the Economy and begun the Historic Boos of the India Manufacturing Industry on 20 September 2019 by Cutting the Corporate Tax in India to the Lowest in Asia and will Now pour in the Trillion Dollars of Foreign Direct Investment into India Industry to create Crores of New Jobs.

 
 By: PRIYADARSHINI SIDDHARTHA REDDY
 
 CHAIRMAN BOARD OF EDITORS
 sidredbuzz@gmail.com
 politicsparty.com
 
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