Gandhi Slams BJP: Indexation Removal and LTCG Tax Hike to Crush Middle Class
Rahul Gandhi criticizes BJP government for eliminating indexation benefits, claiming it will severely impact real estate market and middle class
Real EstateLtcg TaxIndexation BenefitsMiddle ClassBjp GovernmentReal EstateJul 29, 2024
He emphasized that the elimination of indexation benefits has dealt a severe blow to the middle class, while the increase in long-term capital gains (LTCG) tax has struck at its very heart. The removal of indexation benefits for long-term capital gains on real estate, announced in the Union Budget 2024, has sparked significant backlash.
Critics argue that this change, effective from July 23, 2024, could severely impact the real estate market. The real estate sector, which was already facing challenges, is likely to bear the brunt of this decision. Property prices are expected to rise, making it even more difficult for the middle class to own a home.
The indexation benefit, which was introduced to account for inflation, allowed taxpayers to adjust the purchase price of an asset according to the inflation rate. This benefit was especially helpful for individuals who had held onto properties for an extended period. With the removal of this benefit, taxpayers will now have to pay long-term capital gains tax on the entire profit, without any adjustment for inflation.
The BJP government's decision has been met with widespread criticism, with many experts claiming that it will lead to a surge in property prices, making it even more difficult for the middle class to afford a home. The government's move has also raised concerns about the overall health of the economy, with many fearing that it could lead to a slowdown in economic growth.
The Bharatiya Janata Party (BJP) is a major political party in India, currently leading the government at the Centre. Led by Prime Minister Narendra Modi, the party has been in power since 2014.
Frequently Asked Questions
What is indexation benefit?
Indexation benefit is a tax provision that allows taxpayers to adjust the purchase price of an asset according to the inflation rate, reducing the tax liability on long-term capital gains.
What is the impact of removing indexation benefits on real estate?
The removal of indexation benefits is expected to lead to a surge in property prices, making it more difficult for the middle class to afford a home.
What is the effective date of the removal of indexation benefits?
The removal of indexation benefits is effective from July 23, 2024.
What is LTCG tax?
LTCG (Long-Term Capital Gains) tax is a type of tax levied on the profit made from the sale of an asset held for more than a certain period.
Why is the BJP government's decision being criticized?
The BJP government's decision to remove indexation benefits and increase LTCG tax is being criticized for its potential impact on the real estate market and the middle class.
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