New Delhi, Feb 8: The Association of National Exchanges Members of India (ANMI) will seek set off of Securities Transaction tax (STT) against long term capital gains tax (LTCG) from the Finance Ministry.
According to ANMI, the implementation of both STT and LTCG may lead to job losses with no major benefit to government revenues. Anil Shah, a board member of Ahmedabad-based ANMI, told Moneycontrol, “We are trying to convince the government to provide set-off against long term capital gain tax in Securities transaction tax. When market cap was Rs 51 lac crore in 2007-08 STT collection was Rs 8,576 crore, and in 2016-17 when market cap was Rs 121 lac crore, the STT collection was just Rs 8,358 crore. It shows STT income is not increasing as it should increase since market cap increased by almost 3 times.” Another broker, on condition of anonymity, said,“Government should give set off against LTCG. There is less demand in respect of STT collection since most of players like foreign institutional investor or mutual funds are not liable to take set off against LTCG. Market is already becoming costly and we are various different transaction money to the government and regulator. The RBI governor has also shown reservations against LTCG.”
On Wednesday, while announcing the monetary policy decision Reserve Bank Governor Urjit Patel said, “Corporate tax on companies dividend distribution tax, tax for dividend income above Rs 10 lakh, STT and capital gain tax already exist in the economy.”