India Cuts Corporate Tax, Expects to Boost Investments
2 March 2015 16:30 WIB
TEMPO.CO, New Delhi - Finance Minister of India Arun Jaitley has decided to cut corporate tax down to 25 percent from the previous 30 percent in an attempt to increase investments in the country. "The policy will remain effective for the next four years," he said.
Jaitley hoped that the tax cuts would be able to create a more competitive investment climate for investors because currently India is targeting a major infrastructure development, including construction five power plants, with a capacity of 4,000 megawatts each and a budget allocation of US$ 11,3 billion.
Jaitley also hoped to give the underprivileged citizens access to low-cost health insurance by abolishing wealth tax and replacing it with an additional 2 per cent surcharge for super-rich individuals. He also said that the target budget deficit this year is 4,1 percent from the previous 4,5 percent of last year.
This policy however, received negative reviews from business owners. Habil Khorakiwala, CEO of Wockhardt, said that the corporate tax cuts will not gain any significant profits. He added that interests will increase drastically if the government plans to give a two percent tax cut.
ANDI RUSLI | BBC | INDIATIMES