SMEs to be exempt from capital gains tax

A proposal to exempt small and medium enterprises (SMEs) from capital gains tax has received in principle approval from the Finance Ministry. “One of the key proposals in the National Manufacturing Policy to improve access to finance for SMEs was the exemption from capital gains for investment in an enterprise as is done in the case of investment in residential property,” Department of Industrial Policy and Promotion (DIPP) secretary RP Singh said at a meeting on the policy. “The in-principle nod to the proposal by the revenue department would go a long way in enabling a large number of entrepreneurs to raise equity by selling ancestral properties and raise their level of investments and thereby boost employment,” he added. The policy aims at reducing the intrusion of government departments in the affairs of business, reports IANS.