Will mutual fund investors get to see DLSS in Budget 2020? Our expert tells why it is important

Budget 2020: Will Budget 2020 have an enhanced focus on investment? With the introduction of new schemes and reduction in taxation on investments, will investor sentiment improve? Will Budget 2020 (#BudgetOnZee) announce a reduction in the long-term capital gains tax (LTCG) and introduce Debt-linked Savings Scheme (DLSS). Will the demands put forward by the Association of Mutual Funds in India (AMFI) be fulfilled? How much will the mutual fund sector change in the Budget 2020 and whether investments in these instruments give higher returns? For mutual funds investors, this is one of the most important questions as the quality of their their very future, their lifestyle, depends on it.

आएंगी नई स्कीम, निवेश पर घटेगा टैक्स? #MutualFundHelpline में देखिए निवेश बदलेगा मुनाफा बढ़ेगा? https://t.co/5pQVg5lDxT

— Zee Business (@ZeeBusiness) January 31, 2020

Zee Business expert Pankaj Mathpal, managing director (MD) at Optima Money will give you his take on all the burning issues surrounding Budget 2020. Mathpal feels that the Budget 2020 announcements will be a boost for the mutual fund industry and may have announcements that could give a fillip to investments.

The AMFI has given a proposal for introducing DLSS in line with the ELSS or equity Linked Savings Scheme, Mathpal said. He added that he expects the government to give tax benefits of up to Rs 1.5 lakh on investments in the DLSS scheme. The proposal by AMFI is to also put a lock-in period of 5 years as against 3 years in ELSS.

The government may allow small investors to invest in bond markets. The bond market has lower investment cost and lower risks, he added. The investors will also have more options to invest, he added which will be beneficial for people and the government as well.

Mathpal also says that the holding period for equity funds should not be raised. The holding period in equity funds is one year which should not be changed.

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Mathpal's TIP OF THE DAY
-- Don't add loan amount in insurance
--Many banks give home loans to customers in a single life insurance policy
--The banks tell customers to add loan with premium
--Never add insurance premium with the loan
--If you do that then you may have to pay interest on it
--You can take regular premium term life insurance policy