New Delhi, July 25 -- Finance Minister Nirmala Sitharaman has proposed drastic changes in capital gains taxation. This article will discuss budget proposals related to the taxation of equity market transactions.

Presently, the profits on the sale of listed shares and units of equity-oriented schemes of mutual funds held for twelve months or less are treated as short-term capital gains and are taxed at flat 15% under Section 111A if Securities Transaction Tax (STT) has been paid on the same.

If the same is held for over twelve months, the profits are treated as long-term capital gains and are taxed at a flat rate of 10% beyond the initial Rs.1 lakh. This was earlier taxed at zero rate and came tax-free in your hands under Section 112A wi...