Explanation:

Union Budget 2019-20 announced levying corporate tax at the lower rate of 25 per cent for the companies with annual turnover up to Rs 400 crore (Earlier it was applicable to companies having annual turnover up to Rs 250 crore). The tax rate continued to be 30 percent for companies with turnover of above Rs.400 crore. The effective rates, including surcharge and cess, are 29.12 percent and 34.9 percent, respectively. However, on September 20, 2019, the government announced further cut in corporate tax rate to 22 percent. Now, all domestic companies have been given the option of paying tax at the rate of 22 percent as long as they don’t avail any tax exemptions or incentives. The effective rate for such companies, including surcharge and cess, will be 25.17 percent. Further, a tax rate of 15 percent has been announced (effective rate 17.01 percent) for Any new domestic company incorporated post Oct. 1, 2019 making fresh investment in manufacturing. This benefit will be available to companies which do not avail any exemption or incentive and commence their production before March 31, 2023.