First-time retail investors in equity will no longer get the benefit of deduction for investments under the Rajiv Gandhi Equity Savings Scheme (RGESS). The Budget 2017 has phased out the tax benefits of up to R25,000 for small investors in equities.
Noting that “a limited number of individuals availed this deduction”, the Budget proposed to rationalise this tax benefit introduced in Finance Act, 2012 and phase it out from assessment year (AY) 2018-19. However, an assessee who has claimed deduction under this section for AY 2017-18 and earlier assessment years would be allowed deduction under it until AY 2019-20.
