Union Budget 2018 imposed the Capital Gains tax on long term capital gains (LTCG) after a gap of almost 15 years. The budget announced a flat 10% tax on long term capital gains on equity investments and on equity mutual fund investments. Till March 2018, LTCG on equities and equity funds were entirely tax-free in the hands of the investor. Effective April 2018, LTCG from equity funds and from direct equities will be only exempt up to Rs.1 lakh per financial year. Any LTCG beyond that amount will lead to a tax of 10% on these excess capital gains. Remember, this is a flat tax so there is no benefit of indexation available to equity funds.