An assignment for the weekend

A 1 per cent cut in corporate income tax rate from the current 30 per cent will cost Rs 18,000-19,000 crore in revenues, Revenue Secretary Hasmukh Adhia said. [Link]

The problem is not that this statement is at odds with what the government promised in its budget of 2016-17:

Two years after it announced plans to reduce corporate tax rate to 25 per cent, the government today said any such reduction can come after the spread of personal income tax is increased and more people pay taxes.

Students of economics or those who consider themselves savvy in economics should critque that statement for a short answer question.

 

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