Budget 2017: No change in long term capital gains tax on stocks

Finance minister did not change the existing definition of tax on long term capital gains on stocks. This came as a big relief for the investing community. The expectations for the lower costs in terms of removal of Securities Transaction Tax (STT) and Commodities Transaction Tax (CTT) did not meterialise. Union Budget 2016 also had some positives that saved the day for the brokers. Finance Minister Arun Jaitley announced that the commodities markets require further reforms for the benefits of farmers. An expert committee will be constituted to study and promote creation of an operational and legal framework to integrate spot market and derivatives market for commodities trading. e-NAM would be an integral part of such framework. This will further open up opportunities for brokers as volumes go up.It was widely expected that there will be a change in the definition of long term capital gains. It was believed that the holding period to avail benefit of nil long term capital gain tax will be raised to three year from the existing one year. This would have been a big negative for equity markets. Union Budget however, steered clear of the capital gains tax on listed shares.