July 2024

Exit with indexation should be offered

Press, Taxes / By /

Two friends, Ram and Shyam, were travelling on a train when robbers started looting its passengers. Shyam owed some money to Ram. Before the robbers could reach them, Shyam took the money from his pocket and repaid his loan to Ram. Shyam was technically correct in repaying the loan then. Similarly, the Govt.’s move to do away with indexation is technically not a retroactive amendment but it has retroactive impact and is against tax stability. The removal of indexation follows global practices but its abrupt implementation does not. The govt should allow indexation till 2024 with the reduced rates of 12.50%. Opponents will become supporters & the future capital gain taxation will be as per government wishes. The govt can snatch victory from the jaws of defeat as far as the attempt to project a taxpayer friendly image of India is concerned if they announce incorporation of tax admin changes and an enforceable taxpayers charter into the proposed new code.

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Simpler capital gains tax regime highlight of Budget

Press, Taxes / By /

One of the less discussed impact of the budget is the likely reduction in misselling of life insurance policies. The highlight is the simplification of the capital gains regime (at least as far as assets bought from now on are concerned). The situation in respect of past assets bought till 23rd July 2024 remains a little complicated. Harsh’s article in the Business Standard on the impact of the budget.

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A plea to provide more mutual fund data

Mutual Fund / By /

In a race between the top runners of US & the Soviet Union, the US runner beat his Soviet counterpart. “Soviet finishes second, US runner finishes second last” was the spin given by the Soviet media. This mythical story on the cold war era propoganda illustrates the importance of data availbility and transparency in reducing the spread of misleading conclusions. The Indian Mutual fund industry has a reputation for setting up global standards in transparency. Harsh’s article in Business Standard on how even more transparency in the outlined areas will enhance this reputation further.

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Perils of keeping surplus money in bank accounts

Financial, Press / By /

Back in the 1970’s the Soviet bureaucrats worked out a clever ploy to deny permission to a US citizen seeking to marry a Soviet citizen. They asked him to provide proof that he was not “already married”. Getting a document certifying a negative fact is impossible. An Indian bank account holder, victim of cyber fraud, faced a somewhat similar predicament when he was required to prove that he had not received any OTP sms or email from the bank. Harsh’s article in the business standard on how the issue was resolved and what lessons can be learnt so that citizens facing similiar issues have an easier time.

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