Q. If indexation benefits are removed from Long-Term Capital Gains (LTCG) taxation, which one of the following strategies would likely become less attractive to investors?
Answer: A
Notes:
Explanation – Indexation benefits allowed investors to adjust the purchase price of an asset for inflation, thereby reducing the taxable capital gains when the asset was sold after a long holding period. Without indexation, the tax liability on long-term holdings may increase, making this strategy less attractive.
Source: The Hindu
