Posted at 12:50 PM , on January 20, 2020
Mutual funds have been disappointed over the last two years as there has been little respite in the Budget. This time around, mutual funds will look at parity on a number of areas plus a reversal of some of the recent measures pertaining to capital gains tax and the tax on distribution of dividends by MFs.
Time to bring in DLSS
While ELSS has become extremely popular as a tax saving instrument, one argument has been that it forces people to take on risk. The answer could be in extending these Section 80C benefits to debt funds too and introduce a separate DLSS classification for the same. Of course, the lock-in period can be either retained at 3 years or extended to 5 years. The idea is that conservative investors need not be penalized when their financial plan dictates caution.
Parity with ULIPs and NPS
This has been a persistent demand of AMFI over the last few years. The first demand is to put pension plans of mutual funds at par with the National Pension Scheme (NPS) in terms of tax benefits. That will entail extending the additional exemption of Rs.50,000 on NPS to pension plans too. Secondly, while equity MFs are subject to LTCG tax, the ULIPs are exempt from any form of capital gains tax. This puts the mutual funds at a disadvantage and AMFI has been demanding parity.
Posted at 12:44 PM , on January 20, 2020
The last big change in the Union Budget pertaining to commodity markets was in 2016 when the regulation of commodity markets was brought under the purview of SEBI. Since then, the demands of the commodity markets have been growing but the Budgets have not exactly been in sync. Here are 5 expectations.
Time to scrap CTT
It may be recollected that commodity transaction tax (CTT) was imposed on commodity market transactions in 2013, on the lines of STT. Since then, the commodity volumes have failed to scale the pre-CTT levels. The reasons are not hard to seek. Commodity trading is a highly leveraged business and any additional costs tend to get magnified. Each year, the commodity traders have been demanding scrapping of CTT. It is high time this budget bites the bullet.
Posted at 6:15 PM , on February 2, 2016
There was not a great element of surprise in the policy announcement as the RBI decided to maintain status quo. That was largely expected. While the language of the RBI has been largely accommodative, it has some immediate concerns on the macroeconomic front. Also there is the overhang of the critical Fed meet coming up in March, where the world is watching if the FOMC chooses to hike rates by 25 bps or not. It will be interesting because even while the US has been talking hawkish, the ECB has gone ahead and announced lose money policies while the Bank of Japan has actually gone ahead and taken interest rates to negative territory. How the Fed handles this monetary divergence will be interesting to see. Continue reading