India's Capital Gains Tax Hike

Increase in LTCG tax from 10% to 12.5% Increase in STCG tax from 15% to 20% Sharp increase in STT on futures and options trade

Reactions from Market Experts 

Market guru Shankar Sharma expresses disappointment Samir Arora of Helios Capital critiques the tax hike

Historical Context 

2004: STT replaced LTCG tax 2018: Budget reintroduced LTCG tax at 10% on gains over Rs 1 lakh 2024: New revisions in STT, STCG, and LTCG

Comparison of Asset Classes in India 

LTCG tax for equities remains at 12.5% Different rates for real estate, gold, debt mutual funds, etc.

Global Capital Gains Tax Structures 

There is no bifurcation between long-term and short-term in most jurisdictions. Equal taxation on asset classes, unlike India.

Capital Gains Tax in the US 

Taxed based on overall taxable income Rates: Nil, 15%, or 20%

Capital Gains Tax in China 

Exempt from share sales in secondary markets. 20% tax on real estate and other asset.

Capital Gains Tax in Brazil and Japan 

Brazil: Progressive rates from 15% to 22.5% Japan: Total rate of 20.315% for stock sale

Capital Gains Tax in Australia 

Subject to normal personal income tax rate. 50% discount for assets held over 12 months.

Conclusion 

India's LTCG hike is seen as competitive globally. Encourages long-term investment in the Indian market. Market players are expected to adapt to the change.