Mumbai: Revenue Secretary Hasmukh Adhia on Saturday said slashing corporate tax was a big challenge as it would drain huge amount of money from government’s coffers.
He said that cut in tax on companies was not feasible until and unless total income tax collections increased and people became a more tax compliant society. ”Lowering corporate tax a challenge unless personal I-T collections increase and people pay taxes,” Adhia said.
It will cost Rs 18,000-19,000 crore if corporate tax is to be cut by 1 per cent, says Adhia. Adhia reiterated what Arun Jaitley had said in Union Budget 2017 speech that the tax to GDP ratio was very low.
“Only 2 per cent of GDP comes from personal income tax, which is abysmally low; increasing it is a big challenge.” Genuine ESOPs, IPOs, FPOs will not be touched through capital gains tax on share transfer in unlisted companies, he added....