BSE Brokers Forum seeks industry status for stock broking

The BSE Brokers Forum has called upon the government to give industry status to stock broking and implement tax reforms in order to attract more investors and strengthen the business.
"The stock broking fraternity, once given industry status, would ensure access to bank funding, which would ensure that they are able to expand their business in more cities," BSE Brokers Forum said in its pre-Budget memorandum.
"This would create more jobs and in turn, would develop the equity cult in the economy," it said.
It noted that the India broking sector has more than 1,400 brokers in BSE and NSE and more than 50,000 registered sub-brokers providing employment to about 10 lakh people.

The forum has also asked for a rebate in respect of securities transaction tax (STT).
"This would result into government continuing to get STT and at the same time, the burden of tax on the investors being reduced," it said.

Moreover, the group has sought exemption to commodities transaction brokerage from TDS as well as lowering of dividend distribution tax.
Reduction in dividend distribution tax would help firms increase their profits and this, in turn, would result in greater share of dividends for the investors, it said.
Besides, the grouping has also sought more clarity with respect to norms on business income versus capital gains.

Further, the forum has suggested an increase in limit for annual information return (AIR) reporting on transactions in securities to Rs 25 lakh from the current Rs 2 lakh.
"The current limit of Rs 2 lakh is very less considering the nature of securities market. We suggest that the limit should be increased to Rs 25 lakh," it said.
"In case of trading, the threshold is too low and discouraged market participants to trade, so higher limit for delivery base transaction has to be increased," it said.
The forum also said that education about capital market should begin from the high school level to ensure that equity culture is developed among the young population.