December 13, 2017

End the welfare state for stock investors

India exempts capital gains made in listed stocks, on which a short-term transaction tax has been paid, from tax if the stocks had been held for 12 months. This tax exemption is so wrong on so many counts that one does not know where to begin and, having begun, where to stop.

No respectable country that is not a financial tax haven provides this exemption for capital gains arising out of stock market investments. Capital gains are taxed everywhere. Even in India, long-term capital gains arising out of real estate transactions are taxed. A democratically elected government in a predominantly poor country has no reason to exempt returns to capital from tax. Very few Indians are invested in the stock market. A vast majority of them who do are rich by Indian standards. Some of them are very rich. So, large capital gains earned by a small proportion of Indians who are the richest go untaxed. It cannot get more bizarre than this.

Read more at http://www.livemint.com/Opinion/jySWoYabVAerzm69Vi28DJ/End-the-welfare-state-for-stock-investors.html

No comments:

Post a Comment