Details of Rajiv Gandhi equity scheme is expected by the end of this month i.e. July 2012
The Finance Ministry is likely to come out with details of the Rajiv Gandhi equity scheme, which is aimed at boosting retail investments in capital market, by the end of this month.
“We are working on it and the norms should be ready by this month end,” a senior finance ministry official said.
Market regulator Sebi has been pitching for routing this tax-saving equity scheme through mutual fund so as to minimise the risks associated with direct stock investments for the investors.
In order to make the scheme more attractive for retail investors, the ministry has been considering reducing the lock-in period under the scheme to one year from the proposed three years.
Former Finance Minister Pranab Mukherjee, in the Budget for 2012-13, had announced introduction of the Rajiv Gandhi equity scheme under which 50% tax deduction would be provided to retail investors with annual income less than Rs 10 lakh.
Under the proposed scheme, the investors would be allowed to invest up to Rs 50,000 in a year with a lock-in period of 3 years.
The scheme, it was proposed, could be availed once in a life time by investors. It was the first ever tax benefit scheme in India for direct investment in equities to encourage retail investors participation. By offering this scheme, the government aims at channelising household savings into stock markets.