Charging of long-term capital gains may have to be accompanied by removal of STT to avoid double taxation. It is not certain whether it will result in revenue gain but would certainly impact sentiments in the capital market.
The Government with an intention to simplify tax regime on securities transaction has exempted long-term capital gain on transfer of shares through the recognized stock exchange from the levy of tax in Budget 2004.
Now there is an apprehension that Government may remove the exemption of Long-term capital gains tax on the sale of listed company shares. This would prove counterproductive. Here’s why.
Securities Transaction Tax, popularly known as STT, is levied at the rate of 0.1% on the delivery based purchase and sale transactions. STT is levied both on domestic as well as foreign investors.Read more