Budget 2024: New Tax Rules for Share Buybacks to Curb Promoter Misuse
Business
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Moneycontrol•01-02-2026, 17:14
Budget 2024: New Tax Rules for Share Buybacks to Curb Promoter Misuse
- •Finance Minister Nirmala Sitharaman proposes new tax framework for share buybacks.
- •Buyback proceeds will now be taxed as capital gains for all shareholders, ensuring tax only on actual economic gain.
- •Additional buyback tax introduced for promoters to disincentivize tax arbitrage.
- •Effective tax rate for corporate promoters will be 22%, and 30% for non-corporate promoters.
- •The changes aim to protect minority shareholders and align buyback taxation with regular share sales.
Why It Matters: New buyback tax rules aim to protect minority shareholders and curb promoter tax arbitrage.
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