Finance Minister Nirmala Sitharaman announced on Tuesday that the government plans to increase the capital gains exemption limit on specific financial assets to Rs 1.25 lakh per year for the middle and upper middle classes. This significant policy change aims to provide relief to taxpayers within these income brackets.
Presenting the Budget for the fiscal year 2024-25, Sitharaman outlined several key measures, including a hike in the Securities Transaction Tax (STT) on futures and options (F&O) securities. The STT on these transactions will be increased by 0.02 percent and 0.1 percent, respectively. This move is expected to impact traders and investors in the derivatives market.
In addition, Sitharaman announced that income received from share buybacks will now be taxed in the hands of recipients. This change is designed to ensure a more equitable tax structure and to increase revenue for the government.
The budget also announced that listed financial assets held for more than a year will be classified as long-term.