Press Trust of India / New Delhi Jul 06, 2009, 18:54 IST
India Inc may be hailing the Budget as a good job done in trying circumstances but is ruing raising of Minimum Alternate Tax (MAT) from 10 per cent to 15 per cent and no relief on corporate income tax and surcharge.
This would nuetralise the benefits that the companies would accrue from abolition of fringe benefit tax, they said.
Corporates also said abolition of FBT, imposed on them in 2005-06 on perks provided to employees, would make taxation much simpler for them.
MAT, a tax imposed on profitable corporates not falling under corporate tax net, has been raised from 10 per cent to 15 per cent.
Expressing the feeling of India Inc, Bajaj Auto chairman Rahul Bajaj said, "I am happy on behalf of whole industry that FBT has been abolished but also a little unhappy that MAT has been increased."
The government retained corporate tax rate at 30 per cent.
While the government scrapped surcharge on personal income tax, it kept surcharge unchanged at 10 per cent and education cess at 3 per cent on corporate tax, retaining the total tax burden over 33 per cent on India Inc.
Dabur India Vice-Chairman Amit Burman said, "While on the one hand, the government has left untouched key matters like corporate tax, it has on the other hand hiked MAT, which would lead to higher tax outgo and erode the benefits accrued from the removal of FBT".
Stockprices are what traders manipulate, they have nothing to do with the budget. The operators had planned to bring it down in any case. Why were the corporates rushing with their QIPs before the budget? Because they knew about the crash.
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