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Dalal Street Investors Gain Over Rs 7 Lakh Crore Within Minutes Of Corporate Tax Rate Cut



2019-11-12 11:17:12 Industry

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FM’s announcements cheered the investors taking market capitalisation of BSE to 144.72 lakh crore from 138.54 lakh crore on Thursday, a gain of 5.28% or Rs 7.31 lakh crore within minutes

Nirmala Sitharaman on Friday answered the long-standing demand of the corporate sector to reduce tax on domestic firms, pushing the stock market to the day’s high of 38,239, up 2,146 points or up 5.95 per cent. Earlier in the day, market opened flat with Sensex trading 75 points higher at 36,170. FM’s announcements cheered the investors taking market capitalisation of BSE to 144.72 lakh crore from 138.54 lakh crore on Thursday, a gain of 5.28% or Rs 7.31 lakh crore within minutes.



The Finance Minister announced the reduction in corporate tax to 25.17 per cent, inclusive of surcharge and cess, for domestic companies. FM also added that new domestic company incorporated on or after 1st October 2019 making fresh investment in manufacturing will have an option to pay income-tax at an effective rate of 17%. The announcements are expected to give a major boost to the economy and will create a surplus in the hands of corporate, easing liquidity concerns and allowing them to make fresh new investments. The revenue foregone by government on reduction in corporate tax and other relief measures will be Rs 1.45 lakh crore annually. This, FM said, will be used to promote investment and growth.

Earlier, FM Sitharaman also announced that the government will not levy enhanced surcharge introduced in Budget on capital gain arising from the sale of equity shares in a company liable for securities transaction tax (STT). The super-rich tax will also not apply on capital gains arising from the sale of any security including derivatives in hands of foreign portfolio investors (FPIs). Minister also provided relief to the markets by announcing that the listed companies which have announced a buyback of shares before July 5, will not be charged with super-rich tax.

FM also said that companies will now be allowed to use their 2 per cent CSR spend on incubation, IITs, NITs, and national laboratories.

“We welcome the announcement by the Finance Minister. This was a much-needed measure, and demonstrates the government’s commitment to rejuvenate domestic growth. With fiscal and monetary forces working in tandem, and meaningful big bang reforms being announced, alongside monetary easing, we believe the pervasive negative sentiment that exists today has bottomed and will begin to revive. The markets will also deliver a positive wealth effect. The move in the markets will also deliver a positive wealth effect and will spur further financialisation, and engender efficient capital allocation”, said Sunil Sharma, Chief Investment Officer, Sanctum Wealth Management.

Company :-Sanctum Wealth Management Private Limited

Email :-sanctumsem@gmail.com

Phone :-02261064800

Url :- https://sanctumwealth.com/in-the-press/dalal-street-investors-gain-over-rs-7-lakh-crore-within-minutes-of-corporate-tax-rate-cut/


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