Budget 2022: Fillip to start-ups, ESOPs by capping LTCG surcharge at 15%

At present, long-term capital gains on listed stocks are liable to 15% surcharge max, while other long term capital gains suffer a graded surcharge which goes up to 37%

The Finance Minister has capped the surcharge on long-term capital gains from shares of unlisted companies at 15 per cent in the Union Budget 2022-23. This will promote further direct investments in start-ups by high-net worth individuals, venture capital firms and boost the use of ESOPs (employee stock options) by start-ups to remunerate top talent, according to experts.

“The long-term capital gains on listed equity shares, units etc. are liable to maximum surcharge of 15 per cent, while the other long term capital gains are subjected to a graded surcharge which goes up to 37 per cent. I propose to