New Delhi, December 2: The Taxation Laws (Amendment) Bill, 2019, which replaces the ordinance that lowered corporate tax rate, was passed in the Lok Sabha on Monday. The Bill includes the same provisions which were part of the ordinance issued on September 22. With the passage of legislation, the slashing of corporate tax rate from 30 to 22 percent has been codified. Nirmala Sitharaman Reveals Why Modi Govt Slashed Corporate Tax Rate.

The Bill also notes that the lower tax rate would only be applied on firms which do not opt for any tax incentives or tax breaks. Further, the legislation also reduces minimum alternate tax (MAT) for applicable firms to 15 percent from 18.5 percent. For new companies, which would start production before March 2023, the corporate tax rate has been fixed as 15 percent.

While tabling the Bill, Sitharaman also rebutted the Opposition's charge that lowering of corporate tax is aimed at benefiting the "PM's industrialist friends". The Finance Minister dismissed such ulterior motives, adding that the tax rate was rejigged through an ordinance to reap benefits of the ongoing US-China trade war.

"Many multinational companies wanted to get out of China, we had all the reasons, although the budget FY20 had been passed shortly before, we thought of reducing the corporate tax rate," she said.

"We're called 'suit-boot ki sarkar' again and again. We're told that lowering corporate tax helps only rich. I want to tell them that corporate tax cut helps all small and big businesses registered according to Companies Act," Sitharaman further said, adding that the early impressions that have emerged after the move are positive. "A lot of domestic and foreign companies have shown interest to invest post corporate tax reduction," she claimed.

(The above story first appeared on LatestLY on Dec 02, 2019 08:27 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).