India: Corporate Income Tax Rate to Be Slashed to 25 Percent
To remain competitive with China, the India Finance Minister, Arun Jaitley, has stated that India will reduce its corporate tax rate from 30% to 25%. The measure is seen as a positive step towards attracting further foreign investment and will fix the rate at the same level as China.
It is proposed that the rate will take effect from the next financial year, commencing April 1, 2016. However, whether or not the rate reduction achieves a net saving for companies will need to be reviewed closely, given that it may well be introduced at the same time as some incentives and deductions are removed or reduced (which is generally the case when a country makes a rate change).