Capital gain Tax

Subject: Economy

Context:

A Parliamentary panel has suggested abolishing tax on long-term capital gains for all investments in start-ups made through collective investment vehicles (CIVs).

Concept:

• The gain or profit from the sale of assets is classified as a capital gain. The tax for this capital gain needs to be paid in the year that the asset transfer takes place.
• STCG or Short Term Capital Gains Tax is the tax levied on profits generated from the sale of an asset which is held for a government-defined short period is called short-term capital gains tax.
• The short term period differs for various items; for example, for immovable property such as land, building, and house property, the holding period was reduced in FY 2017-18 from 36 months or less to 24 months or less, to deem it as “short term.”