IVCA seeks tax parity, approval for AIFs to invest in NBFCs ahead of budget
Budget
2020:
Indian Private Equity and Venture Capital Association (IVCA) has
requested the Union Government to bring in tax parity for the listed
and unlisted shares and allow the category 1 Alternative Investment
Funds (AIF) to invest in Non Banking Finance Companies (NBFC).
The
association said that currently there is a considerable benefit on
investing in listed shares than unlisted shares in terms of taxes
levied. In order to further channelize domestic and foreign risk
capital, there is a need for complete tax parity for investments in
listed and unlisted securities.
As
compared to domestic investors, Long Term Capital Gains (LTCG) earned
by foreign investors in private companies attract taxation at a
concessional rate of 10 per cent while domestic VC & PE
investments taxed at 20 per cent (for LTCG) with an enhanced
surcharge of 37 per cent.
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