Budget 2024: Sitharaman proposes to extend tax exemption to GIFT units

Finance minister Nirmala Sitharaman has extended the tax benefits to on income from International Financial Services Centre (IFSC) units which were expiring in March 2024 by another year to March 2025, which she said will “provide continuity in taxation.”

This move will elongate the exemption tax exemption on income earned from Gujarat International Finance Tec-City (GIFT) through trading in non-deliverable forward contracts or offshore derivative instruments. Tax exemptions on aircraft or ship leasing from the IFSC centre has also been extended.

Exemption from income of a non-resident from portfolio of financial products or funds, managed or administered from the IFSC was also exempt from tax. The exemptions were provided to encourage foreign investments in financial services and overseas banking units operating in GIFT. Aircraft leasing companies had also set up operations in the IFSC exemption for which is being proposed to be extended.