New Delhi: After intense pressure, the government on Tuesday offered a major relief for individuals, who bought real estate property before July 23, by allowing them to choose between two tax rates for long-term capital gains (LTCG) tax.
As per the amendments to Finance Bill, 2024, circulated to the Lok Sabha members on Tuesday, individuals or HuF who bought houses before July 23, 2024, can compute taxes under the new scheme — at 12.5 per cent without indexation — or old scheme at the rate of 20 per cent with indexation, and pay tax which is lower of the two.
The government has also retained the indexation benefit for taxpayers on properties bought or inherited before 2001. The Budget had proposed to lower the LTCG from 20 per cent to 12.5 per cent but removed the indexation benefits.
The new rates came into effect from July 23. The indexation benefit allowed taxpayers to compute gains arising out of the sale of capital assets after adjusting for inflation. Meanwhile, the Opposition slammed the Budget as being against the salaried and the middle class.
