NEW DELHI: Ruling out income tax exemption for cooperative banks, Finance Minister Arun Jaitley on Friday stated they had been no other from business banks and had been, therefore, required to be treated at par with them.
"Most of those banks are providing standard banking amenities like opening of letters of credit, invoice discounting and collection, lockers and secure deposit vaults, financial institution promises.
"Many of those deal in foreign currency and have additionally opened ATM kiosks. These banks are thus no other from business banks and therefore are required to be treated at par with them," Jaitley stated in response to a question in the Lok Sabha.
He stated that cooperative banks function like some other business financial institution and the principle of mutuality, which was once central to granting exemption, did not apply "because their space of operations extends even to non-members".
"Income-tax is a tax on profits and there is no rationale for exempting profit-making cooperative banks from cost of income-tax," he stated.
"Most of those banks are providing standard banking amenities like opening of letters of credit, invoice discounting and collection, lockers and secure deposit vaults, financial institution promises.
"Many of those deal in foreign currency and have additionally opened ATM kiosks. These banks are thus no other from business banks and therefore are required to be treated at par with them," Jaitley stated in response to a question in the Lok Sabha.
He stated that cooperative banks function like some other business financial institution and the principle of mutuality, which was once central to granting exemption, did not apply "because their space of operations extends even to non-members".
"Income-tax is a tax on profits and there is no rationale for exempting profit-making cooperative banks from cost of income-tax," he stated.
No income tax exemption to cooperative banks: Arun Jaitley
![No income tax exemption to cooperative banks: Arun Jaitley]()
Reviewed by Kailash
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December 31, 2017
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