Interim Budget 2024: Brokerages Seek Overhaul In Capital Gains, Reconsider LTCG Removal

In the lead-up to the upcoming Budget, analysts and experts anticipate announcements tailored to benefit salary classes and rural populations.

New Delhi: The Interim Budget 2024 will be presented in just a few day's time, with specialists and brokerages expectating that the government's primary emphasis will persist on fostering economic growth through increased capital investment and infrastructure development.

Sunil Nyati, Managing Director, Swastika Investmart Ltd has said that the government should reconsider removal of Long-Term Capital Gains (LTCG).

"I advocate for a reconsideration of the removal of either Long-Term Capital Gains (LTCG) or Securities Transaction Tax (STT) to provide further support to the equity culture in India," he added.

Puneet Mishra, Partner, M&A Tax & Regulatory Services, BDO India has demanded for an overhaul in Capital gains. Currently, capital gains are taxed as long term or short term based on their holding period, and the tax rates on these capital gains vary, creating complexity. 

"Rationalizing and standardizing the capital gains regime with regards to certain aspects e.g., streamlining of holding period i.e. long term or short term, uniformity in long term/ short term tax rates across various asset classes, a change in base year for indexation for long-term capital gains etc. would be favourable to the investor community at large. Aligning these changes with the visions of the government for encouraging taxpayer-friendly initiatives such as common income-tax return forms, annual information statements etc. could enhance overall compliance," Mishra said.