Bharat Bond Exchange Traded Fund: Capital gains tax regime for debt mutual funds may be tweaked


The finance invoice 2023 launched adjustments to the tax construction for debt mutual funds. (AI picture)

Bharat Bond Exchange Traded Fund: The authorities is exploring potential changes to the capital gains tax framework for debt mutual funds, aiming to offer reduction for the Bharat Bond Exchange Traded Fund. The finance ministry mentioned this matter in a current assembly, as plans are underway to launch a brand new tranche of the Bharat ETF throughout the present fiscal 12 months, in accordance with an ET report.
The official was quoted as saying that the problem is at present beneath evaluate, with a remaining determination to be made when the federal government finalizes the funds. “Bharat ETF from April 1, 2023, is taxed at the slab rate like any other debt mutual funds and this could be a dampener for the investors,” the official stated.
The finance invoice 2023 launched adjustments to the tax construction for debt mutual funds, shifting from a holding period-based taxation to a slab charge system for funds with lower than 35% fairness investments.
The official added that there’s a perspective advocating for a selected exemption to be granted to the Bharat Bond ETF.
“DIPAM (Department of Investment and Public Asset Management) will send a formal recommendation in this regard to the department of revenue for consideration after the government formation,” the official added.
Additionally, finance ministry officers are set to have interaction with executives from Public Sector Undertakings (PSUs) to guage their funding wants for the present fiscal 12 months.
Since its inception in 2018, the Bharat Bond Exchange Traded Fund (ETF) has facilitated the issuance of bonds by numerous government-related entities and three personal firms, elevating a complete of Rs 33,400 crore in debt since 2019.
In December 2023, the federal government commenced the method of appointing a guide to offer steering on managing the Bharat Bond ETF and issuing a brand new tranche. However, the modifications within the taxation regime have surfaced as a major concern that should be addressed.

Nilesh Desai
Nilesh Desai
The Hindu Patrika is founded in 2016 by Mr. Nilesh Desai. This website is providing news and information mainly related to Hinduism. We appreciate if you send News, information or suggestion.


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