India Inc. welcomes Sitharaman's tax announcement, Modi calls it historic

In a decision which might help drowning economy, Sitharaman said domestic companies will no longer have to pay tax at 30% rate.

This will be effective from the current fiscal year, which started from April 1. Further, she added that amendments in the Income Tax Act, 1961, will be brought to facilitate this decision.

This is being touted as biggest announcement of Modi 2.0.

Biocon's chairman Kiran Mazumdar Shaw was one of the first ones to speak up on the announcement.

"This is a great move which will firmly revive growth and investment. My hats off to FM Nirmala Sitharaman for this bold but most needed move," she tweeted.

Just yesterday, Shaw's critical tweets for Sitharaman drew a sharp retort with the latter saying she is "working" on the economy.

Similarly, Kotak Mahindra Bank MD Uday Kotak called the move "bold".

"Reducing corporate tax rate to 25% is big bang reform. Allows Indian companies to compete with lower tax jurisdictions like the U.S. It signals that our government is committed to economic growth and supports legitimate tax abiding companies," he tweeted.

Mahindra & Mahindra's Pawan K Goenka said Diwali has "come early".

On the massive move, Prime Minister Narendra Modi said his government is committed to making India a $5 trillion economy.

"It will give a great stimulus to Make In India, attract private investment from across the globe, improve the competitiveness of our private sector, create more jobs and result in a win-win for 130 crore Indians," he wrote a short while ago.

While India Inc. and others, including RBI Governor Shaktikanta Das said this decision will "augur extremely well and will be highly positive for our economy", Congress' former President Rahul Gandhi slammed it.

"Amazing what PM is ready to do for a stock market bump during his #HowdyIndianEconomy jamboree (sic)," he tweeted and added the Houston event is the world's "most expensive" event ever.