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Govt to Look at Review of CSR Penal Provisions and Implement Direct Tax Committee recommendations immediately on 15 August


Govt to Look at Review of CSR Penal Provisions and Implement Direct Tax Committee recommendations immediately on 15 August

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Govt to Look at Review of CSR Penal Provisions and Implement Direct Tax Committee recommendations immediately on 15 August

Finance minister NirmalaSitharaman assured companies that “at no point and on no score” does the government want to make it difficult for the industry. The minister said it is the government’s intent to reduce the corporate tax rate and assured the industry of looking at a review of the penal provisions brought in for corporate social responsibility norms.

The FM said “We (the RBI and the government) are on the same page as regards to efforts that are required to boost the economy,”. The RBI on Wednesday cut a key interest rate by 35 basis points, its fourth rate reduction in a row. This seems to be a welcome move as Sensex gained more than 800 points in last 2 days

The finance minister also proposed setting up a tech-driven platform for industry to register complaints against tax harassment.

According to the CII statement, Sitharaman observed that the government’s intent is to reduce tax on companies, and she emphasised that there was “no second thought” on this matter.

Companies with an annual turnover of up to ₹400 crore — 99.3% of the total — currently pay 25% tax, while the larger ones pay 30%. The government will consider levying a uniform 25% tax rate for all categories of companies after there is comfort that tax revenue is on an upward trend, the finance minister said. She added the Direct Tax Committee report will come out on August 15 and the government will immediately look at its recommendations.

The minister plans to travel around the country, including tier-2 cities, to hear and understand first-hand the tax harassment issues faced by companies.

“In addition, a technology-driven platform will be set up wherein cases of harassment can be uploaded, either with or without disclosing identity,” the statement quoted her as saying.

On CSR, the CII statement quoted Sitharaman as stating that she would review the criminal penal provisions, which allow for fines of up to ₹25 lakh to be levied for failure to perform CSR and the jailing of officials responsible for three years.

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