Once the Domestic Company opts to pay income tax under the 22% formula, there will be no MAT applicable in such cases. To boost growth, another provision has been inserted in the Income Tax Act with effect from the fiscal year 2019-20, which will allow any domestic company to pay income tax at 22 percent subject to the condition that they will not avail any incentive or exemptions. The effective tax rate for these companies shall be 25.17 % inclusive of all surcharge and cess. The companies shall also be exempted from paying the Minimum Alternate Tax(MAT). But what about existing companies that are being covered under the 30% existing scheme. For these companies, the MAT has been reduced from 18.5% to 15%: For companies that continue to avail incentive or exemption, the government has decided to provide a Minimum Alternate Tax(MAT) relief. However, the companies opting for 22% tax and 15% tax will not have any MAT liability to be managed. Once the existing companies opt to shift to the 22% system either immediately or at a later date, their liability for MAT will also cease.