Stock Market Crumbles As Budget 2020 Fails to Satisfy Investors
Union Finance Minister Nirmala Sitharaman tabled Budget 2020 in the Parliament on Saturday. Dalal Street didn’t react to the budget well, lead to a major drop in both Sensex and Nifty in Saturday’s trading session. The Sensex dropped 987.96 points to settle at 39,735.53 and Nifty plunged by 373.95 to close at 11,661.85 at the end of Saturday’s trading session. Infrastructure, metals and PSU bank stocks were the major losers on the indices.
Here’s a look at the reasons for the decline in the Stock Market after Budget 2020:
- The Budget didn’t have specific packages for any sector. Investors were expecting relief packages from the union government to revive the ailing auto or real estate sector.
- The introduction of the new tax regime, with the removal of exemptions under 80C, has made the whole processing of filing ITR confusing. Taxpayers can now choose between the old or new income tax regimes.
- Investors were expecting the abolition of long-term capital gains tax (LTCG) or extending the tenure of tax to two years from one at present.
- Unrealistic targets set under disinvestment policy for the Financial Year 2020-21.
- Abolition of dividend distribution tax (DDT) from distributors end. Now DDT will be taxed from the recipients of the dividend.