The government on Tuesday announced Rs 900-crore allocation in the Budget for the newly set up Ministry of Cooperation for the 2022-23 fiscal, besides slashing Alternate Minimum Tax (AMT) on cooperative societies to 15 per cent and surcharge to 7 per cent, which nodal minister Amit Shah hailed saying it will boost the sector.
A new Ministry of Cooperation was formed in July 2021 to strengthen the cooperative movement.
Presenting the Union Budget in the Lok Sabha, Finance Minister Nirmala Sitharaman said, "To provide a level-playing field between cooperative societies and companies, I propose to reduce this rate (AMT) for the cooperative societies also to 15 per cent." Currently, the cooperative societies are required to pay AMT at the rate of 18.5 per cent, while the companies paid at the rate of 15 per cent, she added. The finance minister also proposed to reduce the surcharge on co-operative societies from present 12 per cent to 7 per cent for those having total income of more than Rs 1 crore and up to Rs 10 crore.
"This would help in enhancing the income of cooperative societies and its members who are mostly from rural and farming communities," she added.
However, the surcharge at the rate of 12 per cent will continue to be levied in case of a co-operative society having a total income exceeding Rs 10 crore.
"On satisfaction of certain conditions, a co-operative society resident in India have the option to pay tax at 22 per cent as per the provisions of section 115BAD of the Income Tax Act. Surcharge would be at 10 per cent on such tax," the Budget document said.
Welcoming the Budget announcements, Cooperation Minister Shah tweeted: "Today @narendramodi ji has reduced the AMT rate in the cooperative sector from 18.5 per cent to 15 per vent and surcharge from 12 per cent to 7 per cent, ending the injustice done to the cooperative sector for decades and bringing it at par with the rest of the sectors." This move proves the government's resolve towards realising the vision of 'Sahkar se Samriddhi' (prosperity through cooperatives), he added.
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