NEW DELHI: : Govt on Monday told Parliament that there was no move at the moment to abolish long-term capital gains tax on equities for retail or domestic investors.“The tax policies, including capital gains tax rates, are revised periodically as part of the annual budgetary process and legislative revisions after taking into consideration the macroeconomic parameters,” minister of state for finance Pankaj Chaudhary told the Lok Sabha in response to a question.Investors have been demanding changes in long-term capital gains tax, and the demand gained further traction after the Centre amended the law to attract investments from overseas investors in govt securities. The minister’s statement will put an end to that speculation, at least till the budget exercise begins in Dec.

“The tax rate of 12.5% for domestic and retail investors is the same for FPIs for investments in equity… Govt decided to rationalise the tax treatment applicable to investments by FPIs in g-secs by exempting such investments from income tax on any interest or capital gain. This step will align the taxation on g-secs with many comparable jurisdictions,” the minister clarified and added that the move will ensure durable inflows from long-term investors.The Centre had undertaken an overhaul of the capital gains structure in the last few years, bringing all asset classes on a par. Overseas investors have also been demanding changes to the structure for equities, arguing that govt is imposing long-term capital gains tax as well as securities transaction tax, making India uncompetitive compared with several other markets.