The Bharatiya Janata Party (BJP) has recommended adjusting rules on taxing equity market returns in the upcoming budget, news agency Reuters reported on Wednesday. The report said the proposal, if accepted, could attract more capital inflows into the stock markets.
All eyes are on Union Finance Minister Nirmala Sitharaman who will present the Union Budget on February 1 amid an economic turmoil in the country.
During pre-budget consultations with Sitharaman and the Prime Minister's Office, the BJP leaders urged the government to consider industry demands and listed measures to revive investments.
"There is a concern on LTCG and DDT...as a lot of financial transactions are moving out of the country to Singapore, Hong Kong and London, Economic Affairs spokesman of BJP, Gopal Krishna Agarwal, was quoted as saying by Reuters. He said there was a need to reduce the cost of financial transactions in the country.
"These are doable and without putting much financial burden on the government," Agarwal added.
In the present scenario, Indian companies pay over 15 per cent dividend distribution tax on declared dividends and investors pay another 10 per cent tax on receiving over Rs 10 lakh dividend in a financial year.