Budget 2020: Good news for mutual fund investors! LTCG tax can get big relief

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Budget 2020 Mutual Fund: Budget 2020 can bring huge relief for mutual fund investors.

Mutual Fund Expectations Budget 2020

Budget 2020 can bring huge relief for mutual fund investors. According to the information received by CNBC Awaaz, the government can give a big relief to mutual fund investors in the budget and with some conditions can reduce the effective rate of Long Term Capital Gains Tax i.e. LTCG. Let me tell you that there has also been a demand of the mutual fund industry for giving relief on LTCG tax. If this happens, the trend of investors will move towards the mutual fund industry.

According to sources, by giving a big concession in LTCG in the budget, the government can give big relief on equity and non-equity products. The government has also prepared its outline. According to this, under LTCG tax, the time limit of 1 year is being extended to 3 years. There can be a provision of only 15 per cent LTCG for 1 year. 10 percent LTCG can be kept for 1 to 3 years and income up to Rs 1 lakh can be tax free. Not to impose LTCG for a period of more than 3 years can also be announced in the budget.

Will the tax exempt scheme be announced

In the budget presented on February 1, the government can announce a new scheme of mutual funds that has the benefit of tax exemption. Finance Minister Nirmala Sitharaman may announce in the budget the launch of such a low-cast debt linked savings scheme, wherein investment can be exempted under section 80C of the Income Tax Act. In this regard, the Association of Mutual Fund, Amfi has sent a proposal to the government for a long time. Amfi has once again urged the government to implement it. Explain that at present, only the equity linked saving scheme i.e. ELSS is in the market, which is being exempted under section 80C of the Income Tax Act. If, like ELSS, new schemes are approved in debt funds, it will strengthen the debt market.

Relief on these things is also possible

According to the industry there is also a demand that holding in gold and commodity ETFs should be reduced from the current 3 years to 1 year. This will benefit investors in LTCG tax. Exemption from Dividend Distribution Tax has also been made by Demand Association of Mutual Funds in India for EPFO, NPS and insurance companies investing in mutual fund schemes.

Also Read : Budget 2020: Income Tax Payers Will Get Big Relief In Tax! Survey Revealed Before Budget

Chief executive officer of the Association of Mutual Funds in India (Amfi), NS Venkatesh said that the industry had given this proposal to the government earlier, we hope that even if it is late, the government will consider the views of the industry this time. If this happens, it will not only give a new direction to the bond market or the mutual fund industry, it will also strengthen the country’s economy.

(Also input from agency)

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