No proposal under consideration to scrap LTCG tax on equities, government clarifies

The government on Monday said there is no proposal at present to abolish the long-term capital gains (LTCG) tax on equity transactions for retail and domestic investors, ending speculation over a possible rollback that some market participants had sought over the last few months.

Minister of State for Finance Pankaj Chaudhary made the clarification in a written reply in the Lok Sabha after being asked the time by which the government would scrap LTCG tax for retail and domestic investors to revive market sentiment, protect domestic investors and ensure a level playing field between foreign and Indian investors.

“At present, there is no such proposal under consideration,” he said.

The minister also noted that the tax policies, including capital gains tax rates, are reviewed periodically as part of the annual budgetary process and legislative revisions after taking macro-economic parameters into considerations.

Long-term capital gains tax is levied on the profit made from selling a capital asset such as real estate, stocks, or mutual funds.

Listed equity shares and equity mutual funds are only treated as long-term capital assets if held for more than 12 months.

LTCG from their sale are taxed at a flat rate of 12.5%. However, the tax applies only to gains exceeding ₹1.25 lakh in a financial year.

Eshita Gain is a digital journalist at Mint, where she joined in May 2025. She writes on corporate developments, personal finance, markets, and business trends, with a focus on delivering timely and relevant stories to a broad audience. <br><br> While her core beat lies in business and finance, she is not confined to a single niche and frequently explores stories across domains, including international relations and policy developments. <br><br> She holds a postgraduate diploma in business and financial journalism by Bloomberg from the Asian College of Journalism (ACJ), Chennai. During her time there, she received rigorous training in tracking financial data, interpreting corporate filings, and reporting on business developments. She has pursued her graduation from St. Joseph’s University, Bengaluru in a multi-disciplinary course. Her majors included Journalism, International Relations, peace and conflict studies. <br><br> Eshita has previously worked in digital marketing, which enables her to write SEO friendly copies that are clear and engaging. <br><br> Her primary interest lies in breaking down complex subjects and writing clear, accessible copies that inform readers. She aims to bridge the gap between technical financial language and everyday understanding. Outside the newsroom, Eshita enjoys reading non-fiction, and exploring new places, constantly seeking fresh perspectives and stories beyond headlines.

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