Corporate tax cut to create jobs, Maharashtra biggest beneficiary: Devendra Fadnavis

MUMBAI: Maharashtra chief minister Devendra Fadnavis on Monday praised the Centre’s decision to cut corporate tax saying it would benefit the country and Maharashtra.

Union finance minister Nirmala Sitharaman had on September 20 slashed the tax rate for companies to 25.17% in an effort to get the economy back on track. “This is a very bold and courageous decision by the government as the global competitiveness of Indian companies had reduced due to the high tax rates. When there are high rates, our companies fall behind, but now we can compete with other companies,” said Fadnavis.

He also complimented the government saying, “Tax rates are always increased, governments normally don’t show the courage to reduce taxes -- this is a courageous decision.” Fadnavis also said that Maharashtra would be the biggest beneficiary as large investments would now flow into the state, and said reduction of corporate tax would help companies to create more jobs. “Companies will reinvest this money, their financials will improve -- more jobs will be created. This will increase demand in the market…The decision will benefit Mumbai and Maharashtra as 35% of the corporate tax money that goes to the exchequer generates from Mumbai,” he said.


Fadnavis also said that India would emerge as the most preferred destination of the world due to the corporate tax cut and also because of the ongoing trade war between the US and China. “The industries that were relocating from China to South East Asia will now come to India due to the decision. This will lead to a trickle-down effect which will benefit the country. Also, companies that go into production after November 1, 2019, will get a life-time corporate tax of just 15% which is a very attractive proposition,” said the CM.

He also said that merging 10 banks into four will help these banks become financially strong and lead to “increased risk taking, ensuring that they would be able to lend more”.