After India’s Finance Minister Nirmala Sitharaman announced major tax bonanza, market indices BSE Sensex and Nifty recorded biggest intra-day gains in a decade.
Sensex surged over 1,500 points on Friday after the government slashed corporate tax for domestic companies and new domestic manufacturing companies among other measures.
The Nifty50 on the National Stock Exchange also crossed the 11,000 mark. An official press note on Friday said: “In order to promote growth and investment, a new provision has been inserted in the Income Tax Act with effect from FY 2019-20 which allows any domestic company an option to pay income tax at the rate of 22 per cent subject to condition that they will not avail any exemption or incentive.”
The effective tax rate for these companies shall be 25.17 per cent inclusive of surcharge and cess. Also, such companies would not be required to pay Minimum Alternate Tax.
Further, the government added a new provision in the Income Tax Act with effect from 2019-20 which allows any new domestic company incorporated on or after October 1, 2019 making fresh investment in manufacturing, an option to pay income tax at the rate of 15 per cent.
At 11.36 a.m., the Sensex was at 37,639.69, higher by 1,546.22 points or 4.28 per cent from the previous close of 36,093.47 points. It has so far touched an intra-day high of 37,773.61 and a low of 36,085.74 points.
The NSE Nifty50 was trading at 11,066.10, higher by 361.30 points or 3.38 per cent from the previous close.
With inputs from IANS