India has cut its corporate tax rates in an effort to spur investment and boost growth in the country’s economy.
Finance Minister, Nirmala Sit-hara-man said the base corporate tax rate would be lowered to 22% from 30%.
The surprise move triggered a stock market rally, with the Sensex index jumping 4.5%.
The tax cuts are the latest measures to boost spending and shore up investment in India.
Companies that do receive incentives or exemptions will see their tax rate cut to 25% from 35%.
In addition, some new manufacturing firms will see their corporate tax rate lowered to 15% from 25%.
The country has relied on domestic consumption to fuel growth but spending has slowed sharply.