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Rajiv Gandhi Equity Scheme to be launched by August 15

Under the Scheme, 50% tax deduction would be allowed to retail investors with annual income less than Rs. 10 lakh

July 30, 2012 4:46 IST | India Infoline News Service
The Finance Ministry is expected to launch Rajiv Gandhi Equity Savings Scheme (RGESS) by 15th August. Earlier, the Ministry said it would launch RGESS by the end of July.

Officials from the Department of Economic Affairs (DEA) would meet market regulator SEBI (Securities and Exchange Board of India) next week to finalise the details of the scheme, a senior finance ministry official said on 28th July.

To enhance savings and attract retail investment in capital markets, former Minister for Finance, Pranab Mukherjee in 2012-13 Budget had announced RGESS. Under the Scheme, 50% tax deduction would be allowed to retail investors with annual income less than Rs. 10 lakh, for investment up to Rs. 50,000, with a lock-in period of three years. The objective of RGESS is to channelise household savings into stock markets.

A retail investor can avail the scheme only once in a life time. To make the scheme more attractive for retail investors, the finance ministry is also considering reduction in the lock-in period under the scheme to one year from the proposed three years.

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