FPIs' flight to GIFT City hits air pocket; IFSCA seeks clarity on tax

IFSCA seeks clarity from I-T to clear the decks for more FPIs to re-domicile in GIFT City IFSC

The International Financial Services Centres Authority (IFSCA), a regulatory body, has sought greater clarity from the income tax (I-T) authority on tax implications for foreign portfolio investors (FPIs) looking to re-domicile in Gujarat International Finance Tec-City (GIFT City), said people in the know.

The I-T department’s stance is critical to facilitating the migration of these funds from other overseas jurisdictions to GIFT City, they added. 
 

“In the regulation, there is a grey area on the taxation of the ‘carried interest’ of managers of these funds. Consultations are on between IFSCA and the I-T authorities,” informed a source.
 

‘Carried interest’ is