Govt proposes tax rule changes for offshore funds

The Taxation and Other Laws (Amendment) Bill, 2026 proposes easing eligibility norms for Eligible Investment Funds (EIFs), removing conditions like 25-investor minimum and 10% single-investor cap.

The Bill removes separate exemption criteria for funds in the International Financial Services Centre (IFSC), creating a common framework for offshore funds managed from India.

It replaces a June 5 Ordinance granting tax exemption on interest and capital gains for foreign portfolio investors (FPIs) in government securities.

Finance Minister Nirmala Sitharaman is expected to introduce the Bill in the Lok Sabha.