FM rejects demand for imposition of long term tax
New Delhi: The Centre has rejected the CPM's demands to bring back a tax on share transactions and review the double taxation avoidance treaty with Mauritius.

Addressing the media at a press conference, finance minister P. Chidambaram said that there were no plans to reintroduce the long-term capital gains tax on stock transactions or to review the treaty with the tax haven of Mauritius.

"There is no intention to reintroduce long-term capital gains tax on securities traded on the stock market. The issue of double taxation avoidance treaty… cannot be reviewed unilaterally," Chidambaram said. Several FIIs have registered themselves on the island as its agreement with India exempts them from higher taxes here.

The week that ended had been the worst in the history of the Bombay Stock Exchange, with observers terming the fall in the indices as a "bloodbath."
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