Mumbai, Feb 1 (PTI) With tax on long term capital
gains (LTCG) on equities left untouched by the Government,
experts today welcomed the Budget, saying this decision will
calm the stock market nerves and boost investor participation.
There was speculation that the Government would raise
tax on long term capital gains on securities in the Union
Budget. The market had got worried after Prime Minister
Narendra Modi in December hinted on increasing taxes on
capital markets and the need for all sections, including
market players, to contribute to the national exchequer.
“No bad news on long term capital gains tax is relief
for equity investors. Overall, Union Budget is positive for
economy in general and equity markets in particular,” said
Sharekhan research head Gaurav Dua.
“The Government has presented a reasonably positive
Budget, given the constraints, from equity markets
perspective. No mention of changes in capital gains for listed
securities and concessions to FPIs will soothe market nerves,”
Reliance Securities research (head) Rakesh Tarway said.
Echoing similar sentiments, HDFC Securities MD & CEO
Dhiraj Relli hailed the Government’s decision not to tinker
with the equity capital gains tax regime. “The markets are
rejoicing as they can continue to enjoy the fruits of
investment,” he said.
According to TradingBells COO Parth Nyati, IPO for
public sector undertakings like IRCTC, IRFC and IRCON is a
pleasant surprise and would ensure more retail participation.
“Long term capital gain tax on equity markets remained
unchanged which will further boost investor participation.
Service Tax and STT also remained unchanged,” Nyati said.
Metropolitan Stock Exchange of India (MSEI) COO
Abhijit Chakraborty said FPIs being exempted from indirect
transfer provision address a key concern of foreign investors.
“Listing of IRCTC and IRFC shall be significant
catalyst for capital markets. More PSU ETFs shall aid the
growth of this emerging sector in the market,” he added.
Observing that the market speculation around LTCG,
corporate tax rate cut across various forums was not mentioned
in any form in the Budget, Systematix Shares & Stocks MD
Nikhil Khandelwal said the Budget had more ‘ears on the
ground’ than ‘ears on the market expectations’.
Kotak Securities senior vice president (PCG Research
Dipen Shah lauded the absence of any changes in capital gains
tax, adding apprehensions related to it have been erased.
“Focus on markets will now shift to the global factors
and the remaining quarterly results,” he added. (MORE)
This is published unedited from the PTI feed.