KIND ATTENTION TAXPAYERS
1. Buyback was presently taxed as dividend but extinguishment of share was treated as capital loss.
2. This posed problems to small shareholders who had no capital gains to set off the loss.
3. Also, buyback conceptually is in nature of capital gains.
4. Therefore, in Finance Bill 2026, buyback treatment is changed to capital gains.
5. Shareholders other than promoters will pay tax on such gains at the applicable capital gains tax rate. That is 12.5% for long term capital gains, listed and unlisted. 20% on short term listed, and applicable rate on short term unlisted.
6. However to prevent promoters from misusing the buyback, they have to pay additional income tax.
7. Where domestic company is a promoter, they will pay effective tax of 22% on gains on buyback.
8. Where promoter is other than domestic company, they will pay effective tax of 30% on gains on buyback.
9. This scheme will be beneficial for small shareholders.
10. For promoters, the tax liability will largely remain similar if it is taxed as dividend in their hands.
11. On the whole, the buyback taxation has been simplified with benefits to small shareholders.
@nsitharamanoffc@officeofPCM@FinMinIndia@PIB_India
Here’s the thing: Indians are rising.
And that is actually why anti-Indian sentiment is rising. Not because Indians are so weak, but because Indians are once again becoming strong.
CEOs of companies.
Leaders of countries.
Founders and investors.
Doctors, writers, professors.
Not just slumdogs.
Millionaires.
Now, I know what people will say.
Not all Indians are doing well.
More than a billion are still poor!
And of course that’s true, and will be for a while.
But Indians abroad have risen as individuals:
And India is now rising as a country:
Indeed, India is the fastest growing large economy in the world over the last decade:
And I think Indians have a lot of headroom left. Where does it end up? We don’t know, but if even 5% of 1.4B Indian nationals are at the same level as the ~5M strong Indian American diaspora that currently produces ~6% of US tax revenue, that’s ~70M people capable of producing ~72% of current US tax revenue.
So I think it’s at least possible that India returns to its historical level of relative prosperity:
As a plausibility argument, recall that before America was even a twinkle in anyone’s eye, Marco Polo sought out China and Columbus risked his life to trade with India. So those civilizations were giant economic centers for thousands of years.
And are becoming so again.
This perspective demands a different approach. Not the victim mindset where Indians mimic Western wokes in whining piteously upon every slight. But a mature, tit-for-tat morality befitting a rising people where you cooperate with those that cooperate, ignore what is best ignored, and (proportionately) punish only when necessary.
Because even from a purely realpolitik standpoint, constant cancellation doesn’t work. Recall that wokes tried that for the last decade, and all it got them was epic political defeat. They overused the penicillin called anti-racism, and now we have antibiotic-resistant actual racism.
Indians will need different tactics. And that starts with moving from victim mentality to Vedic mentality, if you'll permit the poetic license. Because India isn't just a rising civilization, it's a returning civilization. And wokes are proven losers, but Indians can be winners.