LTCG tax abolition may cost Rs 40k-50k crore
Times of India 1 hr ago·3 Nov 2026, 10:07 pm
The government's decision to abolish the long-term capital gains (LTCG) tax on equity investments is a major policy shift. This move is expected to reduce the government's revenue by an estimated Rs 40,000-50,000 crore, as it removes a levy on profits earned from holding stocks for more than one year. While this change aims to boost investor sentiment, it creates a significant fiscal gap that the government will need to address through other means.
For retail investors, the removal of the LTCG tax is a positive development. It lowers the cost of holding quality stocks for the long term and encourages wealth creation. However, the fiscal deficit implications mean the government may look to raise revenue elsewhere, such as through indirect taxes or other levies, in the future.
Investors should watch for the government's next steps in the budget to understand how this revenue loss will be managed. While the tax cut is beneficial for the market, the broader fiscal health of the economy remains a key factor to monitor.
Key takeaways
- Category: Economy.
- AI reads the tone as positive (potentially bullish) for the stock.
- Flagged as a high-impact, market-moving story.
Why it matters
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