Finance Minister Nirmala Sitharaman has proposed that buyback proceeds for all categories of shareholders will now be taxed as capital gains, moving away from earlier mechanisms that treated different shareholders differently.
Announcing a major change in the taxation of share buybacks in her Budget speech, she explained that under the new structure, corporate promoters will face an effective tax rate of 22%, while non‑corporate promoters will be taxed at 30% on buyback transactions.
The move aims to streamline taxation, reduce arbitrage between shareholder classes, and ensure a more uniform and transparent tax treatment of buyback‑related income.
This is a developing story.
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