PC may cut tax on stock gains

NEW DELHI: When Finance Minister Palaniappan Chidambaram presents his budget in the first week of July, he could slash the rate at which your stock market profits are taxed.
Today, if you sell stock and make a profit within one year of buying it, you have to pay 30 per cent of your gains as tax.
But if you sell after 365 days of buying the stock, you have to pay only 10 per cent.The July budget might scrap differential levies and combine them into a single rate of 10 per cent or 15 per cent.
In 2003-04, then FM Jaswant Singh had exempted long-term investments in blue chip stocks (the BSE 500 shares) from capital gains tax for one year, when it was to be reviewed. The review hasn''t taken place.
In the interim budget on February 3, however, Singh declared that "it is the conviction of the government" that "the regime of listed equities acquired on or after March 1, 2003 being exempt from long-term capital gains tax should be extended for a further period of three years, to provide stability".