Budget 2025: Mutual Fund Industry Advocates For Reinstating Debt Fund Tax Benefits

The mutual fund industry has proposed three major changes for Budget 2025. These include a rollback in tax rates, with a request to reduce the long-term capital gains tax to 12.5% and the short-term capital gains tax to 20%. Another key suggestion is to reinstate the earlier tax treatment for debt mutual funds to promote the growth of India’s debt market. Additionally, the industry recommends applying TDS to dividends exceeding Rs 5,000 distributed through IDCW (Income Distribution Cum Capital Withdrawal).