‘Sleeping partner cannot answer’, FM Nirmala Sitharaman says on high taxes in stock market, real estate transactions

Union Finance Minister Nirmala Sitharaman attracted strong criticism on the internet because of her cryptic response over the issue of high taxes levied on stock market brokers along with real estate transactions.

In an event at BSE, a stock broker raised a question to the minister on the amount of taxes levied by the government on stock market transactions and on buying a house. 

A broker said they invest money and take risks, but the government becomes a sleeping partner and earns through hoards of taxes, including GST, IGST, Stamp duty, Securities Transaction Tax (STT) and Long Term Capital Gains (LTCG) Tax.

Terming the government as a sleeping partner who takes a chunk of the profit, the broker also questioned the amount of taxes to be paid on buying a house, which includes Stamp Duties and GST.

The question was how the government will assist people with limited resources to buy a house and how can a broker function with hoards of taxes where the government is a sleeping partner and the broker is a working partner.

“A sleeping partner cannot answer sitting here," Sitharaman answered smiling.

Sitharaman’s response to the question garnered a strong backlash on social networking platform Reddit where users criticized the minister’s statement on the issue.

People expected some serious answer from Sitharaman as the issue of high taxes on stock market transactions and in the real estate market has affected investors and homebuyers.

During the event, Sitharaman also appealed to the BSE to work closely with capital markets regulator Securities & Exchange Board of India (SEBI)  to help investor confidence by stringent compliances and robust regulatory standards.