IFFCO which has been demanding parity with Corporate on the issue of taxation has welcomed the Finance Minister for bringing parity between cooperatives and corporates.
The FM has proposed in the budget that there would be parity between the two and cooperative societies would be taxed at 22% + 10% surcharge and 4% cess with no exemption/deductions.
Cooperative societies will also be exempted from Alternate Minimum Tax (AMT) just like Companies are exempted from the Minimum Alternate Tax (MAT), the FM underlined.
Reacting to the development IFFCO MD Dr U S Awasthi wrote, “I thank our finance minister @nsitharaman ji for considering & taking care of #cooperatives in this #Budget2020 by lowering tax on cooperatives to 22% in tune with Corporate Tax; a welcome step.”
“On behalf of IFFCO & it’s more than 36,000 cooperative societies, I welcome the proposal of exempting cooperative societies from minimum alternate tax & also bringing tax rate for cooperative societies to 22% from 30%” Awasthi wrote further.
IFFCO MD also appreciated the FM speech on use of fertilizer to save the soil and said that it was a welcome speech. Efficient and balanced use of fertilisers in our soils to enhance the soil health & it’s productivity is important and IFFCO is already working on this by its Save The Soil project, he underlined.
It is noteworthy that in October 2019, under the subject “Request for correcting the anomaly between Income Tax Rates for Corporates and Cooperatives” IFFCO MD Dr U S Awasthi also wrote a letter to the govt.
Couching his letter in polite terms, Awasthi said “In the Taxation Laws (Amendment) Ordinance No.15 of 2019, it seems that an unintended anomaly has set in, since the option of reduced tax rates has been given only to Domestic Companies and New Domestic Manufacturing Companies under Section 115BAA and 115BAB respectively, while leaving out Domestic Cooperative Societies, which play an equally important role in certain sectors of the Indian Economy”, the letter read.
The mission stands accomplished, said an IFFCO official with satisfaction.