Budget bonanza: Govt likely to do away with dividend distribution tax

There has been discontent about this tax, because any corporate which pays dividend has to pay two taxes - the income tax on its profits and the DDT

The finance ministry is likely to do away with the dividend distribution tax (DDT) in the upcoming Union Budget. Sources in the know have said there have been considerable discussions on the topic among various stakeholders. 

At present, if a company gives dividend to its shareholders, it has to pay DDT of 20.36 per cent (15 per cent plus surcharge and cess).

Two stakeholders, who met Finance Minister Arun Jaitley and Finance Secretary Hasmukh Adhia separately for pre-Budget consultations, told Business Standard that the issue of DDT came up in the meetings that took place between industry representatives and Adhia.