TCG is tax-exempt on the sale of listed securities, since 2005.
BSE has reportedly told the Union finance ministry that long-term capital gains (LTCG) exemptions cause huge revenue loss to the government and also lead to market manipulation, as per a Business Standard report.
For the uninitiated, LTCG is a levy that is charged on returns on equity investment when held for a particular period. LTCG is tax-exempt on the sale of listed securities, since 2005. This had made India one of the most liberal markets in this regard, the bourse said in its presentation last week.
“Since India has one of the lowest tax collection to GDP (gross domestic product) ratio within G-20 countries, every effort must be taken to shore up the revenue collection. LTCG taxation could help,” BSE was quoted as saying.
As BSE estimates, the exchequer could be losing Rs 49,000 crore annually for not charging LTCG.