Newsletter/Booklets 1st Feb 2026
The Union Budget 2026 has proposed, through the Finance Bill 2026, to recharacterise share buy-back proceeds as consideration for sale of shares, taxable under the head “Capital gains” (instead of dividend/Income from Other Sources), allowing deduction of cost of acquisition.
However, promoters will face an additional tax, resulting in an effective rate of 30% for non-corporate promoters and 22% for promoter companies on such buy-backs.
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