February 10, 2016

Long term capital gains to be taxed?

Read at interesting article at Value Research. The highlights:

According to reports, the PM said (at the ET Global Business Summit) - 'Why is it that subsidies going to the well-off are portrayed in a positive manner? Let me give you an example. The total revenue loss from incentives to corporate taxpayers was overR62,000 crore.' He then elaborated, 'Dividends and long-term capital gains on shares traded in stock exchanges are totally exempt from income tax even though it is not the poor who earn them. Since it is exempt, it is not even counted in the R62,000 crore.'

Generally, no one in government comments on specific taxes in the period just before the budget, and that the PM did so may just indicate that this topic has been under serious discussion and was probably at the top of his mind.

NOTE: in most countries, capital gains are taxed so FIIs will initially threaten to leave India but will eventually not.

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