No longer taxing: DDT removal a step in right direction, says Sebi chief

Removal of DDT will result in tax savings of 20 per cent for companies, promoters and other wealthy shareholders may be taxed as high as 43 per cent on the dividends they receive

The Securities and Exchange Board of India (Sebi) has welcomed the move by the government to shift the dividend taxation liability from companies to investors.

“Removal of dividend distribution tax (DDT) was something the market has been asking for. DDT was not logical. It was perhaps introduced to facilitate imposing tax at the unit stage. Ideally, it should be paid by the recipient as per their tax slab,” said Ajay Tyagi, chairman of Sebi, on the sidelines of an event organised by the National Stock Exchange (NSE) to launch the request for quote (RFQ) platform for debt securities.

On Saturday,