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New Roadmap For Capital Gains Tax In Budget 2023-24

New Roadmap For Capital Gains Tax In Budget 2023-24

The tax authorities are undertaking a comparative analysis of India’s capital gains taxation regime with that of other countries with an eye on possible modifications in the upcoming general budget 2023-24. “We do not wish to subject taxpayers to differential periods (for levying tax on capital gains) for various asset classes. The tax slabs and rates also differ, which makes the whole structure cumbersome. We want simplicity. The government is certain that it wants to do it, but we would like to make the modifications at the right time. Our decisions may benefit many, but also hurt a few – which is the difficult part”, a finance ministry official said, adding the changes may take place within two years. Last week, news reports quoted Central Board of Direct Taxes (CBDT) Chairman Nitin Gupta saying that Budget 2023-24 was expected to announce changes in capital gains tax. However, he did not give details regarding the changes in the capital gains tax structure that the finance ministry may decide on. At present, the capital gains tax regime prescribes the holding period for determining whether the gains made at the time of selling the asset are short-term or long-term. The holding period and tax rate differ depending on the asset class. For certain assets, long-term capital gains are taxed without the benefit of indexation or accounting for inflation, which the government feels should be revised, reports Business Today Television special correspondent Karishma Asoodani.