New Delhi : The Securities and Exchange Board of India has sought a status quo on long-term capital gains tax on debt mutual funds, a finance ministry official said.
SEBI Chairman U.K. Sinha in a letter has asked the finance ministry to keep long-term capital gains tax on debt mutual funds unchanged at 10%, a senior ministry official said.
The Budget for 2014-15 (Apr-Mar) has proposed to increase the long-term capital gains tax on transfer of units of mutual funds, other than equity oriented funds, to 20% from 10% in a bid to remove tax arbitrage between debt mutual funds and other debt instruments and bank deposits. The regulator has also sought a status quo on the minimum holding period for being considered for long-term capital gains. The Budget has proposed to increase the period to three years. The finance ministry has forwarded the letter to the revenue department for its comments. -Cogencis