Ace investor Vijay Kedia has called for the abolition of long-term capital gains tax on listed equities, arguing that long-term investors should be treated as providers of patient capital rather than speculators.
In a post on microblogging platform X, formerly Twitter, Kedia said long-term shareholders play a critical role in helping businesses expand, create jobs, innovate and contribute to India’s economic growth. According to him, investors who stay invested in companies over long periods support wealth creation and nation building.
Kedia said India needs massive amounts of long-term capital to build world-class companies, infrastructure and global champions. He argued that tax policy should encourage households to move savings away from passive assets such as gold and towards productive businesses that generate employment, tax revenues and long-term national wealth.
He also pointed out that companies already contribute significantly to government revenues through multiple channels during their growth journey, including corporate tax, GST, income tax paid by employees, customs duties and stamp duties. In that context, he said long-term capital gains often represent the final outcome of economic activity that has already generated substantial tax collections.
A key part of Kedia’s argument was the need to distinguish between investment and speculation. He said a long-term shareholder should be viewed as a partner in wealth creation rather than someone merely participating in market transactions. According to him, tax policy should reward long-term ownership of productive businesses while clearly differentiating it from short-term speculative activity.
Kedia added that India needs more patient capital, greater entrepreneurship and stronger participation in long-term investing. He described the removal of long-term capital gains tax on listed equities as a potentially powerful step towards strengthening India’s capital markets.
The views come as the Indian stock market continues to grapple with soaring oil prices, a massive FII exodus, and a rupee freefall emanating from the Iran conflict.
Tensions between the US and the Middle East nation took a dramatic turn on Thursday. Fresh U.S. strikes on an Iranian military site overnight heightened geopolitical tensions, even as Washington and Tehran continued talks aimed at ending their three-month conflict.
In response, Iran’s Revolutionary Guards said that they struck a US airbase at around 4:50 a.m. local time, according to the country’s semi-official Tasnim news agency, though the IRGC did not disclose the location of the base.
The Indian stock market remained shut on May 28 as both the National Stock Exchange of India and BSE Limited observed a trading holiday on account of Bakri Id. Earlier this month, exchanges were also closed on May 1 for Maharashtra Day.
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