Kerala's masala bonds could be one-off offering after the tax rebate window

KIIFB had registered for issuance before the March 31 deadline, data from the RBI shows

The state-owned Kerala Infrastructure Investment Fund Board’s (KIIFB) rupee-denominated masala bonds could be a one-off offering for now as it was issued after the tax rebate window closed in March.

KIIFB had registered for issuance before the March 31 deadline, data from the Reserve Bank of India (RBI) shows, but may have delayed issuing papers overseas, incurring a withholding tax of 5 per cent on the coupon.

As per government rules, foreign investors in Indian bonds have to pay a withholding tax on the coupon. For example, if the coupon of a bond is 10 per cent, the investor gets