Volume : V, Issue : VII, July - 2016

MINIMUM ALTERNATE TAX:BOOK PROFIT BASED TAX OR ASSET BASED TAX?

H. P. Sachin, Dr. T. S. Devaraja

Abstract :

 Minimum Alternate Tax is a tax paid by every company applicable to zero tax companies. In Income Tax Act, Sec 115JB explains about the zero tax companies. This paper discuss about the issues relating to the concept of MAT. The companies’ obligation is to calculate tax under the provision of 115JB and as per the normal provision. The impact of book profit on companies and tax as per normal provision has huge variance, considered as zero tax companies. The paper focused on the controversial issue that imposing of tax on companies is discussed. The upcoming DTC discussion paper as expressed that the tax on companies should be based on its assets and not on book profits. In this paper secondary data has been used for the study. At present MAT was calculated as a percentage of book profit. The percentage was changed and revised from time to time to match the changing circumstances. Even though, after MAT there is no proper remedy to tax evasion. Some of the major challenges, precautionary measures and recommendations have been suggested.

Keywords :

Article: Download PDF    DOI : https://www.doi.org/10.36106/gjra  

Cite This Article:

H. P. SACHIN, Dr. T. S. DEVARAJA MINIMUM ALTERNATE TAX:BOOK PROFIT BASED TAX OR ASSET BASED TAX? Global Journal For Research Analysis, Volume : 5 | Issue : 7|July 2016

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