By Abhishek Vishnoi and Nupur Acharya India’s reduction in the corporate tax rate to among Asia’s lowest was welcomed by investors as a boon that may help spur economic growth and company profits. The effective corporate tax rate for all domestic companies will be 25.2%, lowered from 30%, the government announced Friday. That reduces it to the same level as Singapore. “This move means concerns on India are quite well covered for the time being,” said Felix Lam, Hong Kong-based senior Asia Pacific equities fund manager at BNP Paribas SA. “We have to now see what companies do in terms of investments and what consumers do in terms of spending.” The benchmark Sensex Index headed for its biggest gain in a decade, climbing as much as 6.3% after the unexpected reduction. The gains wiped out a year-to-date loss that had triggered a so-called correction Thursday as the gauge registered a 10% drop from a record high touched in June. Foreign investors had sold $4.9 billion of local stocks this quarter through Sept. 18, which would be the biggest quarterly outflow since 1999. “As well as providing instant EPS upgrades, these tax cuts should provide a boost to business confidence and… Read full this story
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