Kolkata: The change in dividend distribution tax (DDT) in the general budget and the new income tax structure will not have any adverse effect on the mutual fund industry. A senior official of the mutual fund industry said that the industry has shown good growth, showing strength amid slowdown in the economy.
Peshotan Dastur, director (sales), Franklin Templeton India, said- “The proposal of DDT and the new income tax structure will not have any adverse effect on the mutual fund industry.” There was some apprehension about the growth of the mutual fund sector.
He said that for tax purpose, only two percent or Rs 3,000 crore of the total flow of Rs 1.4 lakh crore came in 2019 in equity-linked savings schemes. But the share of investment in insurance schemes is high to get tax benefits. The official said that there are apprehensions that new income tax proposals will not encourage people to invest to save tax.
He said that investors from lower income groups would benefit from the tax announcements. They would have to pay less tax, whereas in earlier arrangements they had to pay 30 percent tax.
