After Finance Minister Nirmala Sitharaman on Friday announced fresh measures to boost economy, industry leaders reacted with a thumbs up. The announcements made by the government today would have big impact on the economy and revive the economy’s animal spirits, said Deepak Parekh, Chairman, HDFC. The lower tax rates would attract more international manufacturing companies as now we would be comparable to the global companies in terms of tax rates, he added. Sharing his views, Uday Kotak, MD, Kotak Mahindra Bank said that the reduction of the corporate tax rate to 25 per cent is a big bang reform.
Reducing corporate tax rate to 25% is big bang reform. Allows Indian companies to compete with lower tax jurisdictions like the U.S. It signals that our government is committed to economic growth and supports legitimate tax abiding companies.A bold, progressive step forward.
- Uday Kotak (@udaykotak) September 20, 2019
Among the major decisions, the finance minister announced lowering corporate tax rate and relief on capital gains for FPIs. To provide relief to companies which continue to avail exemptions and incentives, rate of MAT has been reduced from existing 18.5 per cent to 15 per cent.
Sharing her views on government’s big reforms today, Kiran Mazumdar- Shaw, MD, Biocon said that it was needed the most. "Corporate Tax Rate Cut From 30% To 25.2% To Spur Growth- this is a great move which will firmly revive growth n investment. My hats off to FM @nsitharaman for this bold but most needed move," she tweeted.
WATCH | Corporate tax rate cut decoded! Sitharaman’s Diwali bonanza for economy
The announcements made today by FM Sitharaman will kickstart the economy, Ajay Piramal of Piramal Enterprises told CNBC TV18. The reforms gives an impression that the government is willing to embrace the industry as a partner, he added.
"Finance Minister Nirmala Sitharaman’s Rs 1.45 lakh crore stimulus to reboot India is a bold move to unleash the animal spirit! This can certainly turn the tide for the economy & markets! Also it's a move towards simpler low tax regime with no or minimal incentives exemptions (which are misused more than used)," Nirmal Jain, Chairman, IIFL Group said.
The demand will get a boost from the government’s moves and the company will save 4 per cent from rate cuts, S Subramaniam, CFO of Titan told CNBC TV18. The consumption demand will get a boost from the government's decisions, he added. Talking on the matter, Sameer Arora, Helios Capital tweeted: "this is not bigger than budget, this is bigger than last 20 budgets."