If you ever wanted to know how lobbying works, or how any government loots…read on: The government makes a lot of money by introducing a Security Transaction Tax – paid by all buyers and sellers of equities. This is a fantastic tax – it collects a lot of money and the government has to collect it ONLY from 2 of the stock exchanges. It is very, very efficient. Capital gains is a tax that you pay on the buy and sell transactions that you do IF YOU MAKE A PROFIT. Now the government has come out with a hair brained scheme which says the ‘small investor’ (the government does not know the difference between an investor and a trader, but that is another post, is it not?). Here if a small investor (govt words) makes a capital gains, he would pay HALF the tax. The government will make a lot more in security transaction tax – STT – than what it can ever lose by giving this 50% discount to a guy. This is a fantastic scheme and will help brokerages earn more, and the government to earn more STT. Will it improve the ‘equity culture’ of the country? You gotta be joking. Tickle me.
Source:
DharniGroup.com