Pre-Budget Expectation Inputs on Capital Gains tax rationalization and Income Tax by Niranjan Govindekar, BDO India

2025-01-17 03:21:03 pm | Source: BDO India

Pre-Budget Expectation Inputs on Capital Gains tax rationalization and Income Tax by Niranjan Govindekar, BDO India

News By Tags | #IncomeTax #capitalgains #BudgetExpertView #PreBudgetExpectations #NiranjanGovindekar #BDOIndia

Below the Pre-Budget Expectation Inputs on Capital Gains tax rationalization and Income Tax by Niranjan Govindekar, BDO India

Budget 2024 had made big changes to the capital gains tax framework, offering both challenges and benefits for investors. Some provisions need a relook. For instance, to streamline the capital gains tax structure by aligning tax rates/ period of holding across various sub-asset classes, for instance, treating international equities the same as domestic equities, debt funds the same as gold funds, and gold funds the same as gold ETFs.The hike in short-term rates from 15% to 20% and in long-term rates from 10% to 12.5% has raised investor tax liabilities significantly. Since now the LTCG tax on securities is on par with other assets, the Securities Transaction Tax (STT) should be abolished.

Budget 2024 unexpectedly removed the indexation benefit for all long-term investments in debt funds. It is expected that all investments in debt funds made up to 31 March 2023, would qualify for the indexation benefit as per earlier provisions.
Tax implications on the buyback of shares - under the amended provisions, the entire consideration received is treated as dividends and taxed in the hands of the shareholders. It is recommended that the government amend the law to allow the cost of the acquisition of shares as a reduction and tax only the net amount as a dividend.

Above views are of the author and not of the website kindly read disclaimer

Disclaimer: The content of this article is for informational purposes only and should not be considered financial or investment advice. Investments in financial markets are subject to market risks, and past performance is not indicative of future results. Readers are strongly advised to consult a licensed financial expert or advisor for tailored advice before making any investment decisions. The data and information presented in this article may not be accurate, comprehensive, or up-to-date. Readers should not rely solely on the content of this article for any current or future financial references. To Read Complete Disclaimer Click Here

IGI Logo

Pre-Budget Expectation Inputs on Capital Gains tax rationalization and Income Tax by Niranjan Govindekar, BDO India

Top News

Tag News

More News