Sanjay Malhotra Explains New Simple Tax Rates and Job Boost in Union Budget
Revenue Secretary Sanjay Malhotra announced changes in capital gain taxes to simplify understanding. He stated, “Our intention is to make it simple, and reasonable.”
New Tax Rates
Finance Minister Nirmala Sitharaman proposed:
- 20% tax on short-term gains for certain financial assets
- 12.5% tax on long-term gains for all financial and non-financial assets
Exemption limits for lower and middle-income classes were increased from Rs 1 lakh to Rs 1.25 lakh per year.
Classification of Assets
Listed financial assets held for more than a year are long-term. Unlisted financial assets and all non-financial assets must be held for at least two years to be long-term. Unlisted bonds, debentures, debt mutual funds, and market-linked debentures will attract tax on capital gains at applicable rates, regardless of the holding period.
Focus on Employment
The budget also focuses on employment and skill development, with Rs 1.48 lakh crore allocated. Three ‘Employment Linked Incentive’ schemes will be introduced under the Prime Minister’s package, targeting EPFO enrolment, first-time employee recognition, and support for both employees and employers.
Doubts Revealed
Sanjay Malhotra -: Sanjay Malhotra is the Revenue Secretary of India. He helps manage the country’s money and taxes.
Union Budget -: The Union Budget is a plan by the Indian government on how it will spend and earn money for the year.
Revenue Secretary -: The Revenue Secretary is a top official in the government who looks after the country’s income, mainly from taxes.
Finance Minister -: The Finance Minister is a government official responsible for managing the country’s finances, including the budget. Currently, it is Nirmala Sitharaman.
Capital gain taxes -: Capital gain taxes are taxes you pay when you sell something like stocks or property for more money than you bought it.
Short-term gains -: Short-term gains are profits made from selling assets held for a short period, usually less than a year.
Long-term gains -: Long-term gains are profits made from selling assets held for a longer period, usually more than a year.
Exemption limits -: Exemption limits are the amounts of money you can earn without paying taxes.
Lower and middle-income classes -: These are groups of people who earn less money compared to others. Lower-income means less money, and middle-income means an average amount of money.
Employment and skill development -: These are programs to help people get jobs and learn new skills to work better.
Rs 1.48 lakh crore -: This is a large amount of money, specifically 1.48 trillion rupees, which the government plans to spend on certain programs.
Employment Linked Incentive schemes -: These are special programs that give benefits to companies for creating new jobs.
