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2026-11-02 14:42:26
[Securities and Exchange Board of India Recommends Abolishing Long-Term Capital Gains Tax for Foreign Investors to Boost Sluggish Stock Market] (1) According to two sources familiar with the matter, the Securities and Exchange Board of India (SEBI) has recommended that the government abolish the long-term capital gains tax for foreign investors to boost the underperforming Indian stock market. The SEBI has also proposed tax relief for domestic mutual fund investors, exempting them from long-term capital gains tax when they sell existing holdings and invest the funds in new assets. (2) These recommendations were made months before the release of the annual federal budget in February next year, but they are not binding, and the final decision rests with the government. (3) The Indian stock market has underperformed other emerging markets over the past two years: foreign investors have sold a record $31 billion worth of Indian stocks this year, and overseas investment by Indian retail investors has increased significantly as returns have stagnated. Against the backdrop of continued foreign selling and pressure on the Indian currency, the SEBI made the above recommendations after holding dozens of meetings with foreign investors over the past two years.
