New Delhi, Aug. 24 -- Soon after Finance Minister Nirmala Sitharaman announced to roll back higher surcharge on foreign and domestic portfolio investors, the Income Tax (I-T) department on Saturday clarified that the tax payable at normal rate on the business income from the transfer of derivatives to a person other than Foreign Portfolio Investments (FPIs) will be liable for the enhanced surcharge.
"The derivatives (future & options) are not treated as capital asset and the income arising from the transfer of the derivatives is treated as business income and liable for normal rate of tax," an official statement said.
Tax experts said that the clarification has watered down the expected benefits of the government announcement and can make...