New Delhi: Finance minister Nirmala Sitharaman on Monday tabled two key Bills in the Lok Sabha amid loud protests from the Opposition over the political crisis in Maharashtra.
Lok Sabha was adjourned for the day soon after Sitharaman tabled the Bills.
The Taxation Laws (Amendment) Bill, 2019 seeks to replace the Ordinance issued in September offering corporate tax rate cuts to boost investments, and the International Financial Services Centres Authority Bill, 2019 seeks to regulate financial services centre market in the country.
The Lower House witnessed a stormy session on Monday with Congress members raising slogans on the Maharashtra issue and the Speaker suspending two Congress members of Parliament TN Prathapan and Hibi Eden for protesting.
Earlier in the day, Congress leader Rahul Gandhi said in Lok Sabha that there was no point in asking questions as democracy has been “murdered" in Maharashtra. Later, Bharatiya Janata Party leader Ravi Shankar Prasad said it is the Congress, not the BJP, which "murdered" democracy in the state.
The House is expected to discuss the two Bills for passage during the winter session of Parliament. The Ordinance on taxation law amendment offered a lower 22% corporate tax rate for companies that do not avail of any tax incentives and a 15% rate for new manufacturing companies that start production before March 2023, in a bid to reverse the economic slowdown.
It also reduced the rate of minimum alternate tax (MAT) that businesses which continue to avail of tax breaks have to pay, to 15% from 18.5%. The government’s initial estimate of revenue loss on account of the tax rate cut is ₹1,45,000 crore.
Before the rate reduction came into force, business income was taxed at 30% exclusive of cess and surcharge other than the companies with sales upto ₹400 crore, and new manufacturing companies were taxed at 25%. The rate cut is aimed at boosting investments, but it remains to be seen how many companies are able to make big ticket announcements in the next few months as the rate reduction came in the middle of the fiscal and businesses may take time to finalise their plans.
India’s economic growth had slowed to a six-year low of 5% in the June quarter and it may have slowed down further in the September quarter, going by indicators like industrial output.