Sensex surges by 500 points on hope of rollback of FPIs tax

The benchmark indices zoomed up substantially in the post lunch session after rumours were rife in the market that government is likely to rollback the higher surcharge applicable on Foreign Portfolio Investors (FPIs)

Market cheered the possibility that the central government might rollback the higher surcharges for FPIs through a notification or an ordinance. Government has been holding a series of meeting with the industry stakeholders to devise plant to revive the economy. Any official comment from the government on the rolling back is yet to be made. It is said the the Prime Ministers Office (PMO) has been monitoring the continuous sell-off in the capital market.

Earlier, in the Union Budget of 2019, the Finance Minister Nirmala Sitharaman had introduced a surcharge from 15 to 25 per cent on taxable income between Rs. 2 to 5 crore, and from 15 to 37 per cent for income above Rs. 5 crore. This tax slab covers FPIs operating as trusts or association of persons.

Also, government is considering to waive-off penalty on India Inc. for not conforming to the new CSR norms.

On Thursday, at 15:00 hours, the BSE Sensex was at 37,242.73, up by 552.23 points or 1.51 per cent, while the broad index Nifty50 was at 10,995.30, up by 139.80 points or 1.29 per cent. The popular trading index Nifty Bank was at 27,982.80, up by 280.75 points or 1.01 per cent.