Budget 2016: Expectations of retail investors
Tax-savings bonds, which give retail investors a tax exemption on the interest payable to them, would provide an incentive for greater retail participation in IDFs.
Zee Media Bureau
New Delhi: The euphoria that had gripped the entire nation during the 2014 Lok Sabha election in the form of ‘Modi wave’ is still very much alive in people’s mind and now it is time for the BJP dispensation at the Centre to deliver what it promised in the run up to the Lok Sabha polls.
Moreover, the government has taken several steps in last 9 months to break policy logjam by speeding up reforms both on FDI and structural front, which has resulted in the form of gradual rejuvenation in the confidence of investors towards Indian equities.
Here are some changes that the Retail investors expect in this year’s Budget that would benefit them.
Launching of equity schemes
Deduction in respect of Rajiv Gandhi Equity Savings Scheme: The Rajiv Gandhi Equity Savings Scheme is a tax saving scheme that was announced in the 2012-13 Union Budget aimed at first time retail investors. The scheme is aimed at encouraging the flow of savings of small investors in the domestic capital market, and presents investors with tax benefits provisioned under a new section, 80CCG in the Income Tax Act, 1961. It is recommended to raise the income ceiling to Rs 25 lakh as compared to Rs 12 lakh at present.
Allowing Infrastructure Debt Funds to issue tax saving bonds
Infrastructure Debt Funds (IDFs) should be permitted to issue tax savings bonds, and such issuances may be limited to a percentage of the net-worth of the IDF. Such tax-savings bonds, which give retail investors a tax exemption on the interest payable to them, would provide an incentive for greater retail participation in IDFs.