Centre to ease long term capital gains tax for sale of properties

The government on August 6 proposed a relief to taxpayers with respect to capital gain tax on real estate properties by giving them the option to choose between 20% and 12.5% tax rates.

As per the amendments to Finance Bill, 2024, circulated to the Lok Sabha members, an individual or HUF buying houses before July 23, 2024, can compute his taxes under the new scheme of 12.5% without indexation and the old scheme of 20% with indexation and pay such tax which is lower of the two, a PTI report said.

Hemal Mehta, partner, Deloitte India said that the amendment related to tax on the long-term capital gains tax on immovable properties is a welcome move. “Now a resident taxpayer can opt for a tax rate which is more beneficial for properties acquired prior to July 23. This gives relief to taxpayers who can also opt for exemption under section 54 to compute and invest the long term capital gain in another residential unit.”