Aam Aadmi Party member Raghav Chadha has urged the government to abolish the long-term capital gains (LTCG) tax for individual investors in the equity market. He said doing so would increase household wealth and redirect savings from gold and real estate into more productive assets.
“Long-term capital gains tax on equities should be made nil in this country for individual investors,” Chadha said while taking part in the Rajya Sabha debate on the Union Budget 2026-27 on Monday.
Chadha added that the Securities Transaction Tax (STT), which was increased in the Budget, was originally introduced to replace LTCG. The STT came into effect when LTCG on equities was zero and was intended as a straightforward, upfront levy, regardless of profit or loss. While he welcomed the hike in STT on derivatives, he warned that keeping both STT and LTCG would discourage genuine long-term investors.
While urging the government to abolish LTCG on equities for individual investors, Chadha highlighted international examples such as Switzerland, Singapore, the UAE, Hong Kong, New Zealand, Qatar and Malaysia, where long-term equity gains are largely tax-free.
According to a PTI report, Chadha also praised the increase in the investment limit for non-resident Indians (NRIs) but urged the government to examine why foreign institutional investors (FIIs) are exiting India. He said that the hike in the NRI investment limit comes after foreign portfolio investors withdrew nearly $23 billion in the previous financial year.
While acknowledging the positive step, he added that relying just on NRI inflows is not enough and called for addressing the structural reasons behind the ongoing foreign investor exits.
Chadha criticised the Union Budget 2026 for failing to revise income tax slabs, saying it was a big letdown for the salaried middle class. He raised concerns over the low allocation for public healthcare.
The AAP leader also proposed placing all land and property records on a blockchain-based digital registry to enhance transparency. He suggested a transparent, time-stamped and tamper-proof system would help reduce disputes and curb scams.
ALSO READ: 'Equity Is All White, Real Estate Isn't': Why Gurmeet Chadha Wants LTCG Tax Split
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