Friday, March 20
Finance minister Nirmala Sitharaman had 177 paras in her budget speech for 2026-27. To me, one single para holds significant possibilities for India. In para 130, she said, "Recognising the need to enable critical infrastructure and boost investment in data centres, I propose to provide tax holiday till 2047 to any foreign company that provides cloud services to customers globally by using data centre services from India." This provision provides a clear visibility of tax exemption for over 20 years, and has the potential to draw significant global investment in this space. Thus, this could be like the Y2K moment for the Indian software sector in 1995. Hu Wang, founder of Nvidia, has said that data centres are "the largest infrastructure in human history". A data centre has a tremendous tr
Sunday circled back to a period when most of today’s active traders weren’t even born—July 2004. After a surprise summer poll victory, the then finance minister P Chidambaram introduced the Securities Transaction Tax (STT) for the first time in the cash market. That caused Indian equities to crater. Sunday was no different. With India now the global derivatives leader, higher STT on futures and options caused the Nifty and the Sensex to lose 2% each. 127849999CURBING SPECULATION Sunday’s proposal, finance minister Nirmala Sitharaman said, seeks to curb F&O speculation. “Higher taxation across both the F&O segments will affect market participants across the board including retail traders, institutions, high-frequency traders, proprietary desks, algorithmic traders, broker
The budget has proposed a major reset in the taxation of share buybacks, shifting them from being treated as 'deemed dividends' back to capital gains. Under the proposal, buyback proceeds for individual shareholders will be taxed at 12.5%, significantly lower than the current slab-based rate of up to 30%. Tax treatment for promoters has also been rationalised: foreign promoters will face a 30% levy, while Indian promoters will continue to be taxed at 22%. Tax experts said the change corrects a distortion in equity taxation and restores buybacks as a more efficient capital-return mechanism. "With effect from October 2024, buyback proceeds were treated as dividends, taxed at regular rates, while the cost of acquisition was recognised separately as a capital loss. Less than 18 months later, t
