No Hike In LTCG Tax Rates In New Income Tax Bill, I-T Department Clarifies

There are no changes proposed in the long-term capital gains (LTCG) tax rates in the new Income Tax Bill, 2025, the Income Tax Department clarified on Tuesday.

"There are news articles circulating on various media platforms that the new Income Tax Bill, 2025 proposes to change tax rates on LTCG for certain categories of taxpayers. It is clarified that the Income Tax Bill, 2025 aims at language simplification and removal of redundant/obsolete provisions. It does not seek to change any rates of taxes," the I-T Department posted on social media platform X.

"Any ambiguity in this respect shall be duly addressed during the passing of the Bill," it added.

Capital gains tax refers to the tax applicable on the profit one makes by selling an asset. These assets could be stocks, bonds, or real estate. The tax amount is based on the period for which one holds the asset before its sale.

If one sells an asset after holding it for a year or less, the profit on it is considered a short-term capital gain and is taxed as per regular income tax slabs in most cases.

If an asset is held for more than a year, the profit is considered a long-term capital gain and is taxed.

The I-T Department's clarification on LTCG tax assumes significance as rumour-spreaders on social media claimed that the tax could be raised from 12.5% to 18.5%.