Higher capital gains tax: Who benefits the most?
capital gains tax rates is a welcome and logical change by the government. Under the new tax rules, stock investing will now attract a 12.5% Long-term capital gains tax (previously 10%) and 20% Short-term capital gains tax (previously 15%).
Excluding tax havens such as Hong Kong, Singapore and the UAE, India’s capital gains tax remains one of the lowest globally, especially as the amount of capital gains increases. And as Finance Secretary Somnath explains, analysis of the tax base shows that capital gains tax doesn’t really impact the middle class. 88% of the capital gains income is earned by individuals with an income above Rs. 15 Lakh and 62% by those with an income greater than Rs 1 crore. The investing community in India is a minority demographic that benefits from a tax rate much lower than the marginal rate, a standard tax rate for income earned by salaried and other business incomes. Even with the new rates, we’re still much below the marginal tax rate.
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Offering CollegeCourseWebsiteIndian School of BusinessISB Chief Technology OfficerVisitIIM LucknowChief Executive Officer ProgrammeVisitIndian School of BusinessISB Chief Digital OfficerVisitBeing a developing country, India is still treading the tightrope between fiscal consolidation and growth. In this context, the government's strategy to remain committed to their fiscal targets by finding new sources of increased revenue while impacting the minimum number of citizens, particularly those who can
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