Journal Press India^®

Author Details ( * ) denotes Corresponding author

Dividend Distribution Tax, unlike other taxes, is one such tax structure whose incidence keeps on changing. When it was introduced in the year 1997, the shareholders’ enjoyed the immunity of not facing the liability for the same. However, with the passage of economy, its incidence kept on shifting from company to shareholders’. With the announcement of Union Budget 2020-21, the finance minister proposed to reintroduce the vintage model, with a view to provide some relief to the corporate houses which were otherwise burdened with a bundle of taxes. Shift of incidence is not a novel step; however, the current situation of pandemic made this proposal’s impact uncertain. Through this paper, the author strives to bring in picture the pros and cons of this proposal; how fair it would be for the shareholders’; whether the giant corporate houses would get an opportunity to avail the benefit of not paying DDT, irrespective of the pandemic; whether it would portray Indian taxation structure as a liberal one for the prospective foreign companies; and whether vintage model would provide assure success in 21st century.

Keywords

Tax incidence; Dividend; Shareholder; India.

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