Phasing out tax exemptions to reduce litigation: FinMin

Finance Ministry today said phasing out of tax exemptions will reduce litigation and lower corporate tax rates will make India a more competitive investment destination.
"Phasing out of tax exemptions will reduce litigation. Lowering of corp tax rates will make India more competitive," Secretary Economic Affairs Shaktikanta Das said in a tweet.
In another tweet, he said small and medium enterprises (SMEs) will be major beneficiaries of lower corporate tax rates.
"Now they pay max rate of 30 per cent due to their inability to invest in capex regularly," Das added.
The Central Board of Direct Taxes (CBDT) today proposed a roadmap for elimination of tax exemptions and deductions as a precursor to gradual reduction of corporate tax rates from the current 30 per cent to 25 per cent over next four years.

Meanwhile, Revenue Secretary Hasmukh Adhia said in series of tweets said sufficient notice have been given to corporates to adjust to the proposed changes in the tax regime.

"The underlining principle is that there is sufficient notice given for people whose projects are in pipeline. No sudden stoppage," he said.
The Secretary said the final decision on phasing out of exemptions would taken only after considering all suggestions.
According to proposal of CBDT, sunset clauses with regards to tax exemptions will be renewed and no weighted deduction will be allowed for any specified business activity from April 1, 2017 onwards.