There is both furore and appreciation for the reforms from cross sections of the society. This essay tries to explore the pros and cons from various perspectives.
The budget elucidated the projection for 2007/8 at 4.6 billion. On the capital Gains front a new tenet was recommended in the name of 'entrepreneurs' relief.' By this way the entrepreneur is given the leeway of paying the capital gains tax at the rate of 10% on capital gains up to the first 1m, instead of the originally proposed 18%
The projection for 2007/08 is 4.6 billion. The budget introduces a new tenet in the capital gains tax called the 'entrepreneurs' relief.' Wherein the entrepreneurs need to pay just 10% on capital gains up to the first 1m, instead of the originally proposed 18% . This calculus of taxing the entrepreneurs makes the entire exercise a bit complicated.
Let us first understand the capital gains taxation announced in this budget. Different slabs have been fixed for different levels of business per se. There would be a tax rate of 18% on the sale of assets above 1m whereas 10% on sales of assets up to 1m. This implies that about 80,000 people are expected to qualify for the 10% rate. Additionally, the gains made on different occasions would also qualify for the 10% rate up to a "cumulative lifetime total of 1m of gains."
The Chancellor faces flak on the Capital Gains front ...