Finance secretary TV Somanathan talks about the rationale behind key decisions in the Union Budget 2024-25, and the government’s approach towards growth and equity, in an exclusive interview with KG Narendranath and Prasanta Sahu. Excerpts. Currently, the most elastic and growing source of income in the economy is capital gains. Taxation of long-term capital gains on equities re-started in 2018 after a break of about 14 years, and considerable revenues (Rs 1 trillion a year) are already coming in via this source. The increase in the rate of the tax (from 10% to 12.5%) is very modest one. Streamlining of the tax treatment of asset classes is the primary objective (of the changes in tax rates, holding periods), but revenue is definitely a motive too. However, it’s not our objective to keep raising the tax rates.