Jaitley introduces 10 % Long Term Capital Gains Tax

New Delhi Feb 2: Finance minister Arun Jaitley on Thursday has presented the budget.The FM has however introduced Long Term Capital gained tax and said that many corporates heavily benefit as there is no taxes on capital gains from stock market.

jaitley has said that "The total amount of exempted capital gains from listed shares and units is around Rs3,67,000 crores as per returns filed for A.Y.17-18. The major part of this gain has accrued to corporates and LLPs."

FM has added that "I propose to tax such long-term capital gains exceeding Rs1 lakh at the rate of 10% without allowing the benefit of any indexation. However, all gains up to 31st January 2018 will be grandfathered."

He added that "For example, if an equity share is purchased six months before 31st January 2018 at RsRs100/- and the highest price quoted on 31st January 2018 in respect of this share is Rs120/-, there will be no tax on the gain of Rs20/- if this share is sold after one year from the date of purchase. However, any gain in excess of Rs.20 earned after 31st January 2018 will be taxed at 10% if this share is sold after 31st July 2018. The gains from equity share held up to one year will remain short-term capital gain and will continue to be taxed at the rate of 15%."



Jaitley added that "I also propose to introduce a tax on distributed income by equity oriented mutual fund at the rate of 10%. This will provide level playing field across growth-oriented funds and dividend distributing funds."