What is STCG Tax (Short-Term Capital Gains Tax) — India?
STCG tax in India applies to profits from selling equity held for less than 12 months, taxed at a flat rate of 20% (post Budget 2024).
Formula
STCG Tax = (Selling Price - Purchase Price) × 20%
How to Interpret
The higher STCG rate penalizes frequent trading. The 7.5% difference between STCG (20%) and LTCG (12.5%) is a strong incentive to hold longer.
Typical Ranges
Flat 20% on all short-term equity gains. No exemption threshold.