Ace investor Shankar Sharma, commenting on the election results, mentioned on X (formerly Twitter) that due to the close contest between PM Modi’s NDA and the INDIA bloc, short-term capital gains tax (STCG) and long-term capital gains tax (LTCG) might be reduced, but they are unlikely to be increased.
In the recent interim budget, Finance Minister Nirmala Sitharaman did not make any changes to the capital gains tax structure. The short-term capital gains tax for selling listed securities like equity shares and equity-oriented mutual funds (with over 65% equity exposure) before one year remains at 15%, provided the Securities Transaction Tax (STT) is paid at the time of transfer.
For units of equity-oriented funds or listed equity shares sold after one year, a long-term capital gains tax applies. Any gains over ₹1 lakh in a year are taxed at 10%.
Over the weekend, exit polls predicted that the NDA would win over 350 seats. However, on Tuesday, the Nifty 50 and the BSE Sensex, two benchmark indices, fell more than 5% after reaching all-time highs on Monday. The BSE Sensex dropped by 4,389.73 points (5.74%) to 72,079.05, and the Nifty 50 fell by 1,379.40 points (5.93%) to 21,884.50.
Vinod Nair, Head of Research at Geojit Financial Services, stated that the market is still expecting stability within the alliance, with the BJP likely emerging as the primary election winner. This is anticipated to benefit the rural economy significantly, with a strong focus on social economics from the new government policies.
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