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SBI Chief Seeks Tax Parity for Savings

31 Jan

Summary

SBI chairman advocates for equal tax treatment on equity and bank deposits.
A tax holiday extension is sought for International Financial Services Centre income.
Current tax disparity favors equity over bank deposits with higher rates for savers.

SBI Chairman C S Setty has advocated for equal tax treatment on returns from equity investments and bank deposits. Setty believes India should align with global tax practices where such parity exists, noting that current provisions favor equities with lower tax rates on capital gains compared to the slab-based taxation on bank deposits.

This call for parity intensifies as bankers report savers increasingly opting for equity markets due to better returns, potentially reducing banks' lending resources. Separately, a banking industry official suggested extending the tax holiday for income booked within the International Financial Services Centre (IFSC), particularly in Gujarat's GIFT City. This extension is proposed to stimulate activity, drawing a comparison to the longer tax holidays offered in Dubai's financial center.

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