Budget 2018: Finance Secy backs decision to leave corporate tax untouched

Adhia said that reducing the tax rate would have meant a loss of Rs. 60,000 crore to the exchequer.

Following the Centre’s decision to levy 25% corporate tax for companies with Rs. 250 crore turnover, Finance Secretary Hasmukh Adhia on Thursday backed the decision saying it has been made keeping the welfare of the common man in mind.

Hasmukh Adhia, Financial Services secretary, has announced new measures that prohibit individuals from the private sector would no longer be hired for top posts at Public Sector Banks (HT File Photo)

“The corporate tax reduction was a difficult subject for us to handle. However, tax rate reduced would mean Rs 60,000cr loss for us. We cannot let such sums of money go into big shareholders, as we need to focus on the welfare of the poor, and we stay firm on this,” Adhia said.

In terms of unchanged personal income tax, Adhia said the Rs 40,000 tax rebate offered to salaried employees will largely benefit honest taxpayers.

Earlier in the day, Finance Minister Arun Jaitley proposed to cut the corporate income tax rate to 25% for companies with a turnover of up to Rs. 250 crore.

While presenting the Budget speech, the minister said the tweak will result in 7,000 companies coming under the 25% tax slabs.

“With the minimum support price increased, commodities will not get expensive. It is the middlemen who consume profits, and therefore, common man will not be affected. We want farmers to get procurement allowance as well,” he said.