Are High Capital Gains Taxes Keeping FIIs Away From India? Should Tax Rates Be Cut?

India’s equity market taxation is back in focus after Finance Minister Nirmala Sitharaman said discussions around capital gains tax and securities transaction tax are healthy. While no tax cuts have been announced, her remarks have sparked debate over whether India needs to rethink its equity tax structure. On Money Today, tax expert Ankit Jain, Partner at Ved Jain and Associates, explains how STT, stamp duty, brokerage charges and capital gains taxes add to investors’ costs. He discusses how India’s tax regime compares with global markets, whether high taxes could influence foreign investor flows, and why long-term investors may need greater incentives. The conversation also examines whether calibrated tax cuts could encourage participation while balancing government revenues.