Centre wants petroleum products under GST: Revenue Secretary
New Delhi: Days after the Union Budget, the union government’s Revenue Secretary Sanjay Malhotra sat down for an extensive interaction with DH’s Gyanendra Keshri and Arup Roychoudhury. Speaking on the various tax announcements, Malhotra said that the government set out with an intent to streamline the capital gains taxation regime. He also said that the old personal income tax regime will soon be redundant, with 70% of taxpayers having already opted for the new regime.
What was the government’s rationale behind the changes in long-term and short-term capital gains tax?
It is basically to make things simpler. There were too many rates, both for LTCG and STCG, along with different holding periods. So, the whole purpose basically is to simplify, and while doing so, reduce the tax arbitrage between the various asset classes. Keeping in mind of course, that all asset classes may not be similar and recognising that fact that special dispensation may be kept for real estate. That rollover benefit was retained for homes but not for other asset classes.
The third reason behind the changes is to reduce the disparity between taxes on capital gains and other income like salary. So, there is a small shrinkage to that effect. Why should income which is arising out of shares or out of real estate or out of a house, unless invested elsewhere, be taxed differently?
