In 2004,Chidambaram did away with LTCG in his budget stating the following:
Capital gains tax is another vexed issue. When applied to capital market transactions, the issue becomes more complex. Questions have been raised about the definitions of long-term and short-term, and the differential tax treatment meted to the two kinds of gains. There are no easy answers, but I have decided to make a beginning by revamping taxes on securities transactions. Our founding fathers had wisely included entry 90 in the Union List in the Seventh Schedule of the Constitution of India. Taking a cue from that entry, I propose to abolish the tax on long-term capital gains from securities transactions altogether. Instead, I propose to levy a small tax on transactions in securities on stock exchanges
Note the word instead.It was both an implicit and explicit promise to the people of India.
Source: http://www.moneycontrol.com/budget2007/pre_budget/Union%20Budget%202004-05.pdf
Now,we have Arun Jaitley as the Finance Minister breaking this promise by bringing back the LTCG but not scrapping the STT !!
Capital gains tax is another vexed issue. When applied to capital market transactions, the issue becomes more complex. Questions have been raised about the definitions of long-term and short-term, and the differential tax treatment meted to the two kinds of gains. There are no easy answers, but I have decided to make a beginning by revamping taxes on securities transactions. Our founding fathers had wisely included entry 90 in the Union List in the Seventh Schedule of the Constitution of India. Taking a cue from that entry, I propose to abolish the tax on long-term capital gains from securities transactions altogether. Instead, I propose to levy a small tax on transactions in securities on stock exchanges
Note the word instead.It was both an implicit and explicit promise to the people of India.
Source: http://www.moneycontrol.com/budget2007/pre_budget/Union%20Budget%202004-05.pdf
Now,we have Arun Jaitley as the Finance Minister breaking this promise by bringing back the LTCG but not scrapping the STT !!
No comments:
Post a Comment