What is LTCG? - Based on the tenure of your investment, gains from stocks/mutual funds are classified as long-term or short-term capital gains. For debt funds, the threshold for classification as LTCG is 3 years, and for equity funds, it is 1 one year.
What changes? - The tax on Long-term capital gains has so far been 0% for all equity or equity oriented mutual funds. With the new rule in place, Long-term gains greater than Rs.1 Lakh, will be taxed at 10% starting 1st April 2018. The purchase cost for calculation of gains for taxation will, however, be revised to higher of (1) the actual purchase NAV and (2) the NAV of the scheme as of 31st January 2018. The last provision has been the most amusing part of the announcement, mainly because of being referred to as the 'grandfather' clause, a legal and an accurate term. Do note, these changes come into effect only starting 1st April 2018.
source :economic times
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