What is the rate of corporate taxation? Are there any other taxes on profits?
For the current year (Fiscal Year 2005-2006), rate of corporate tax is 30 percent for domestic companies plus a surcharge of 10 per cent. Foreign companies are chargeable to tax at 40 percent plus a surcharge of 2.5 percent. In addition, Education Cess of 2 per cent over and above tax so arrived would also be levied. India has entered into Double Tax Avoidance Agreements with various countries, which provide favourable tax positions. In addition, corporate are required to pay tax @ 12.5 percent at the time of distribution of dividends to their shareholders plus surcharge and education cess.
