{"id":24950,"date":"2019-09-25T09:45:15","date_gmt":"2019-09-25T04:15:15","guid":{"rendered":"https:\/\/enterslice.com\/learning\/?p=24950"},"modified":"2019-09-24T18:34:20","modified_gmt":"2019-09-24T13:04:20","slug":"the-introduction-of-alternate-minimum-tax-in-india","status":"publish","type":"post","link":"https:\/\/enterslice.com\/learning\/the-introduction-of-alternate-minimum-tax-in-india\/","title":{"rendered":"The Introduction of Alternate Minimum Tax in India"},"content":{"rendered":"

Tax is the primary source of revenue for the Government of India. The Indian government has given its taxpayers the benefit of multiple deductions and incentives to encourage tax payment. This facility resulted in some companies becoming “zero tax-paying” units, which ultimately resulted in a loss of revenue for the government. The concept of Alternate Minimum Tax<\/strong> was introduced to maintain a balance between introductions of such deductions and to ensure the levy of tax on such zero tax companies. <\/p>\n\n\n\n

Alternative Minimum Tax – An Overview<\/strong><\/h2>\n\n\n\n

Alternative Minimum Tax, as the name suggests, means the minimum\namount of tax that\nis levied on income as opposed to the usual amount of\ntax. Such tax is paid at the rate of 18.5% plus applicable surcharge and cess. AMT is levied on adjusted income in a financial year\nin case the tax payable on regular income is\nless than AMT on adjusted total income.  <\/p>\n\n\n\n

AMT is\ngoverned and regulated <\/em><\/strong>under Section 115JC of Income Tax\nAct, 1961.<\/em><\/strong><\/p>\n\n\n\n

What is the adjusted\ntotal income?<\/strong><\/h2>\n\n\n\n

Adjusted Total income for Alternative Minimum Tax<\/strong> is a gross income that is increased by adding back all the deduction covered under Heading C of Chapter -VI. Thus, all the deduction from 80HH<\/strong> to 80RRB is added back to the Gross Income except Section 80P and 10AA.<\/p>\n\n\n\n

Applicability of AMT<\/strong><\/h3>\n\n\n\n

Initially,\nthe concept of AMT was introduced to bring\nonly the corporates under its ambit. Gradually, it was\nmade applicable to non-corporate taxpayers as well. At present provisions of\nAMT are applicable on the following:<\/p>\n\n\n\n