Budget 2018: Capital gains tax: First principles first

The PM sees zero tax on long-term capital gains and dividend income as unfair since the beneficiaries are not poor, only the well-off dabble in shares

Will the Union Budget impose a tax on long-term capital gains on shares? There is a lot of speculation on this now. The Prime Minister has been hinting at it for over two years. On January 29, 2016, speaking at a business summit, he said, “Dividends and long-term capital gains on shares traded in stock exchanges are totally exempt from income tax even though it is not the poor who earn them.” On December 24, 2016, the PM said in another speech “those who profit from financial markets must make a fair contribution to nation-building through taxes ... the contribution