Capital gains tax should be rationalised; need simpler ITR form: Experts

The Budget should bring in a simpler income tax return form for assessees having only capital gains or dividend or interest income, along with simplification of the capital gains tax regime, experts said.

Under the income tax law, gains arising on the transfer of capital assets -- both movable and immovable -- are charged to tax under the head 'Capital Gains'. The tax rate is different for different asset classes.

Also, depending on the period of holding, the income is classified as short or long-term capital gains and taxed accordingly.

With capital markets in India growing at an exponential pace and companies taking the IPO route to raise funds, there is widespread demand that the capital gains tax structure be streamlined.

Deloitte India Partner Rohinton Sidhwa said the holding periods for different types of assets and the number of tax rates for different types of capital assets should be reduced to a maximum of 1-2 periods or rates (along with related surcharges).

"Economic a