Some of the important Direct taxes:-
Fringe Benefit Tax
To reduce the profit on booked entry, many companies started
providing various benefits to their employees and maintain
them under their input cost. Thus reducing the profit which in
turn leads to less taxation by the government.
Therefore government-imposed Fringe Benefits Tax (FBT)
which is fundamentally a tax that an employer has to pay
instead of the benefits that are given to his/her employees. It
was an attempt to comprehensively levy a tax on those
benefits, which evaded the tax.
The list of benefits encompassed a wide range of privileges,
services, facilities, or amenities which were directly or indirectly
given by an employer to current or former employees, be it
something simple like telephone reimbursements, free or
concessional tickets, or even contributions by the employer to a
superannuation fund.
FBT was introduced as a part of the Finance Bill of 2005 and
was set at 30% of the cost of the benefits given by the
company. This tax needed to be paid by the employer in
addition to the income tax, irrespective of whether the company
had an income-tax liability or not.
The fringe benefits tax was abolished in the 2009 Union budget
of India.
Minimum Alternate Tax
The concept of Minimum Alternate Tax (MAT) was introduced
in the direct tax system to make sure that companies having
large profits and declaring substantial dividends to
shareholders but who were not contributing to the Government
by way of corporate tax, by taking advantage of the various
Fringe Benefit Tax
To reduce the profit on booked entry, many companies started
providing various benefits to their employees and maintain
them under their input cost. Thus reducing the profit which in
turn leads to less taxation by the government.
Therefore government-imposed Fringe Benefits Tax (FBT)
which is fundamentally a tax that an employer has to pay
instead of the benefits that are given to his/her employees. It
was an attempt to comprehensively levy a tax on those
benefits, which evaded the tax.
The list of benefits encompassed a wide range of privileges,
services, facilities, or amenities which were directly or indirectly
given by an employer to current or former employees, be it
something simple like telephone reimbursements, free or
concessional tickets, or even contributions by the employer to a
superannuation fund.
FBT was introduced as a part of the Finance Bill of 2005 and
was set at 30% of the cost of the benefits given by the
company. This tax needed to be paid by the employer in
addition to the income tax, irrespective of whether the company
had an income-tax liability or not.
The fringe benefits tax was abolished in the 2009 Union budget
of India.
Minimum Alternate Tax
The concept of Minimum Alternate Tax (MAT) was introduced
in the direct tax system to make sure that companies having
large profits and declaring substantial dividends to
shareholders but who were not contributing to the Government
by way of corporate tax, by taking advantage of the various
