No plans to abolish LTCG tax on equities and mutual funds: FM Nirmala Sitharaman

The Centre has no plans to abolish the long-term capital gains (LTCG) tax on equities and mutual funds stated the Finance Minister.

Finance Minister, Nirmala Sitharaman told Parliament on Tuesday, December 7 that the Centre has no plans to abolish the long-term capital gains (LTCG) tax on equities and mutual funds. Neither is the centre planning to increase the period of LTCG from one to two years for mutual funds nor equities.

“There is no such proposal under consideration,” said the Union Minister of Finance on being asked about the increase in LTCG on mutual funds and equities. Speaking on the decision to abolish the LTCG tax to help accelerate economic recovery from the coronavirus pandemic outbreak, no decision has been taken.

The long-term capital gains on the sale of equity were made taxable from April 2018 onwards. Before that, LTCG on equity investing used to be tax-free in India. The Centre earned Rs 1,222 crore from LTCG in 2018-19 and Rs 3,460 crore in 2019-20 and Rs 5,311 crore in 2020-21, as per reports.

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