From mint · · 1m 20s
India Should Scrap Equity Tax on Foreigners
Edelweiss head urges scrapping foreign equity tax to boost market inflows.
In brief
Edelweiss head urges scrapping foreign equity tax to boost market inflows. Edelweiss Financial Services Ltd. Chairman Rashesh Shah says removing capital gains tax on foreigners could revive India's stock market and support the rupee. Originally reported by mint.
Edelweiss head urges tax change
Edelweiss Financial Services Ltd. Chairman Rashesh Shah says India should remove capital gains tax on foreigners to revive the stock market.
“We need to showcase to the foreigners we want them”
Growing call for tax exemption
Dozens of people are pushing the government to exempt foreign portfolio investors from long-term capital gains tax on listed equities.
Tax rates for foreign investors
Long-term gains on listed equities held for more than a year are taxed at 12.5%, while short-term gains are levied at 20%.
Foreign investor outflows
Foreign investors have been relentless sellers of Indian stocks, with net outflows exceeding $28 billion so far this year.
Recent market rebound
Foreign investors have poured in more than $5 billion into Indian equities over the past three weeks, helping drive a nearly 10% rebound in the domestic market.
Potential capital inflows
Shah estimates Indian mutual funds could channel $40 billion to $50 billion annually into equities, while insurance companies and pension funds could contribute $20 billion to $25 billion.
The big picture
Edelweiss Financial Services Ltd. Chairman Rashesh Shah says removing capital gains tax on foreigners could revive India's stock market and support the rupee.
