Rationalisation of securities transaction tax (STT), rebate on STT under Section 88E of the Income Tax Act, an alternative for the dividend distribution tax (DDT) and a National Development Mission (NDM) are among the key suggestions that were made by broker associations, Association of National Exchanges Member of India (ANMI) and BSE Brokers Forum (BFF), on Tuesday.
Equity brokers and officials from stock exchanges on Tuesday met Subhash Chandra Garg, Finance Secretary and Secretary — Economic Affairs, Ministry of Finance.
BusinessLine had reported on June 11 that broker associations were seeking restoration of the STT rebate that was withdrawn in 2007 by then Finance Minister P Chidambaram. Ahead of next month’s Union Budget of Modi 2.0 government, ANMI has urged the Finance Ministry to treat STT as ‘tax paid’ and not as ‘expense’ only for those having business income in their books. They are not seeking abolition of STT, ANMI said in a note.
Under NDM, it is proposed that investments of ₹50,000 in IPOs and MFs by retail investors should be allowed as deduction from the gross total income of the individual. Brokers say it will have negligible impact on government revenues.
Vijay Bhushan, President, ANMI, said, “Our pre-Budget submission covers issues which have a large impact on stock market trading, reintroduction of rebate under erstwhile Section 88E for STT and CTT. There is an urgent need to incentivise and encourage equity investments.”