Maarthandam

Netizens Furore

With the NIFTY index quickly turning red just 30 minutes after the opening bell, netizens on twitter [now known as X], took no time to highlight the excessive tax on stock transactions which deter people from investing.

Excessive Taxes Upset Investors

Here is a list of taxes that netizens deem excessive :

1. Short-Term Capital Gains Tax (STCG)
2. Long-Term Capital Gains Tax (LTCG)
3. Securities Transaction Tax (STT)
4. Tax Deducted at Source (TDS) on dividends
5. Dividend Distribution Tax (DDT) (replaced by TDS on dividends)
6. Goods and Services Tax (GST) on brokerage services
7. Stamp Duty on the purchase and sale of stocks

While the government has not reduced anything, the increase in taxes year by year leaves the average investor with very little margin. To add more burden, a little bit of income tax and market volatility make stock market a risky bet in the Indian landscape.

With the outflow of FIs and the current economic fiasco, netizens deem the increase in STT,LTCG AND STCG to be a big financial mistake.

Netizens Call for Reversal of Taxes

Deemed to be excessive and unnecessary, netizens have begun to call for the abolishment of such taxes as a last resort to pump up the falling stock market. This thought stems up from the fact that investors get very little margin from the existing tax system.

#AbolishSTT Trends on Twitter

#AbolishSTT trends on Twitter highlight growing frustration with the Securities Transaction Tax (STT) being levied on every transaction. Many argue that it is an unnecessary burden on investors, especially since it applies to both buy and sell transactions, and is separate from other taxes like capital gains tax.

One of the main criticisms is that STT can eat into a significant portion of the returns from frequent trading, especially for short-term investors. Additionally, the tax disproportionately affects retail investors who might be making smaller transactions, as opposed to large institutional players who can absorb such costs more easily.

Another argument is that STT distorts the market by discouraging liquidity and increasing the overall cost of transactions. Critics also argue that since capital gains tax already exists to tax profits, an additional tax on every transaction becomes redundant.

Anger Evident

With the falling markets and increasing taxes, users on the Internet have called for lowering of taxes, and it is completely upto the government to look into this matter and level out the market sentiment amicably.