Mumbai: Capital markets regulator SEBI chief Ajay Tyagi on Tuesday welcomed the Budget announcement of putting the onus of paying dividend distribution tax (DDT) on the investor rather than the company.
He also said the watchdog has sought replies from fund houses like Franklin Templeton who have marked down their investment for debt holdings of telecom company Vodafone Idea following the broader issues in the sector.
Abolition of DDT for companies "was something which the market was asking. If you can collect actual tax from the investor as per business income, that should be the tax. That is logical," Tyagi told reporters on the sidelines of an event at NSE here.
"It is a movement in the right direction," he added while commenting on the government's decision to transfer the tax liability on DDT.
On the fund houses which have reportedly been marking down their investments in Vodafone Idea's paper to zero following the Supreme Court judgement on AGR, Tyagi said SEBI has sought a reply but refrained from directly commenting on it.
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"It is the fund houses' own domain to take a view as to what is the asset value and the formulation which AMFI has suggested is only if it is below investment grade. Then there is a matrix. If it is not below investment grade, there is no stipulation as such," Tyagi said.
"Why they did it, we had asked them," he added, making it clear that he doesn't off-hand know their replies.
When asked about the big announcement on an initial public offering for life insurance behemoth LIC, Tyagi said the government will have to go through the process like any other issue and made it clear that there have not been any discussions between the government and SEBI on this.
To a question on the possibility of the stake sale being under ten per cent and what view SEBI will take on that, Tyagi said no formulation has come from the government in this regard.
(PTI Report)
