President Ram Nath kovind has given the assent for the amendment to the Indian stamp act 1899 introduce as a part of Finance act 2019
Amendment proposal
- Creation of the legal and institutional mechanism to enable estate to collect stamp duty on securities market instrument at one place by one agency (through the stock exchange or clearing Corporation authorised by stock exchange or by depositories)
- A mechanism for appropriate sharing the stamp duty with relevant state government based on the state of domicile of the buying client
- creation of a coordination Council representative from Union and state under article 263 of the Indian constitution deals with the responsibility of making recommendation regarding review/ revision of stamp duty rates
Stamp Duty Rates
- The duties levied by Maharashtra will be taken as a benchmark as the state of Maharashtra account for 70% of the total collection
- the rate would be chosen in such a manner that it provide a revenue neutral position to the statement why reducing the overall tax burden for investors
- the stamp duty will have to be paid by either the buyer or seller of financial security as against the current practice of levying the duty on both.
Benefit of proposed amendment
The Amendment Bill rationalize and harmonized system of living stamp duty and help curb tax evasion the cost of collection would be minimised by revenue productivity is enhanced for the adoption of centralised collection mechanism is expected to bring in not only more revenue but greater stability to the revenue collection by the state the amendment good father and in developing equity market and equity culture across the length and breadth of the country ushering in balanced regional development
