Ahead of the Union Budget, industry body AMFI has asked the government to bring in uniformity in taxation on listed debt securities and debt mutual funds (MFs) and equality in tax treatment between MFs and unit-linked insurance schemes (ULIPs).
Mutual funds and ULIPs both invest in securities.
In its budget recommendation for 2022-23 to the finance ministry, the industry body has requested that mutual funds be introduced on the lines of low-cost, low-risk, tax-exempt debt-linked savings schemes (DLSS). should be allowed. Equity Linked Savings Scheme (ELSS)
It is further proposed that investments up to ₹1.5 lakh under DLSS would be eligible for tax benefits, subject to a lock-in period of 5 years (as in the case of tax-saving bank deposits). Currently, ELSS qualifies for tax benefits under section 80CCC of the Income Tax Act for an investment limit of up to ₹1.5 lakh in a financial year.
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