SEBI LTCG tax removal for foreign investors: regulatory signals and what it means for Indian markets

Indian regulators and market watchers are focusing on long-term capital gains (LTCG) tax policy for foreign investors ahead of the upcoming budget cycle. Recent reports from Reuters and other outlets document discussions around scrapping the 12.5% LTCG tax for foreign investors, a policy move that could influence foreign participation in Indian markets.

What the sources say

• Reuters reports an exclusive that India’s regulator is backing scrapping LTCG tax for foreigners. Original article: https://news.google.com/rss/articles/CBMivgFBVV95cUxNMzZGZDRyZ3dzMWVMcEp4bmVRbGNoRFdhODFvSDFjZmplU1VDRXNleUs1MElLczNVRHN5WS0xc2phWXFZaktGQ1pqelBPbjRfeWRLSFBqajEzRU43bWxpUkZtNVM4VGs0LVVUMzVlbW13X0FGZlJLWWZDZmpscXV4NVBNemxXZ2RhZEozakVfRlNWb3E0MTlEYlhveXRZVHVmeUozNkJ4RjBBQTR2TUt2QnJZajV1SVRMZUEyMG5n?oc=5
• Livemint reports ahead of Budget 2027 that SEBI recommends removal of the 12.5% LTCG tax on foreign investors. Original: https://news.google.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?oc=5
• The Times of India highlights SEBI LTCG tax relief discussions in pre-budget proposals. Original: https://news.google.com/rss/articles/CBMimAJBVV95cUxPbi1fMVFBTGpqOTctQXpFeVlQSFpGell6R0xyb25SQkNUNmZwQmlGODI4SF9EeVBiSzFfQU52VTBnYlpxV2FzM1VFaXBEa1lvRml3QVB4a0lQUlJYQ2ZxamZwUjRCMmlKaTNZanFHRGxva18zZEFiVmpLbGZsUldsVlk0U2NFemFzN3c3MjRYb0J3Y28tS2c3WWd6YndZMmJpdEVmRjlKbGdPZF9RQ2VuemFjdGZiRXUxUHE1VC1td1JrMEFadGtHRVlEZ3Npd2NiMUt1MU9TaUR4RHZ6dmJQZGcxeWVNUjJQNWowdkhEM1VyZlZaRDI0bG84blhrVlk5OFYzNlFmaVV5anZ1NGwzMzBqYzlORHp50gGeAkFVX3lxTFBPa2tBRXVLZzBCVlMteDl3Ym8yeTEwdklUVUJpNVNUdEVjZkIwa0ZQNjltcVNQenpLRUNMam1QOVZ0ZWFEZWRlUEZVM3BzYnVYdmVuclQ4TU51bVI5U3FQMHpuLUlranc2bDZFQkpHWEd5eEUtTzktT0o0eEFWZFRuc08yLThocDVHYnpseDE4aHBRN0xCVjdnQWhJRjNGUVllU3BwZ2dKeUVKaGdzaFo1eGZ3RElYTHpwa2dxTV9rQXNNM2FnYnkxUS0xRmpGc2lHU0F2UzNDYlZJeXRMSGRCcDk2UlVqU3c5aHRUREdpWFQ0cmw0X1VEZ0ZfQUFsRlFXVTRpNEl6dUtTdG05YzZTMFNpX1Q3NzlzTW1YYlE?oc=5
• ET Government notes SEBI’s move on REITs/InvITs depository receipts, illustrating regulatory developments. Original: https://news.google.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?oc=5

Editorial take

The conversation around LTCG tax for foreign investors sits at the intersection of policy and market access. While exact regulatory details and timelines may evolve, the signals point to considerations that could affect foreign participation, liquidity, and capital-raising in Indian markets. As always, readers should track official SEBI and government communications for the final policy stance and timelines.

Source links

• Reuters: https://www.reuters.com/world/india/regulator-backs-scrapping-ltcg-tax-foreign-investors-sources-2026-11-02/ (example URL from feed)
• Livemint: Ahead of Budget 2027, Sebi recommends removal of 12.5% LTCG tax imposed on foreign investors | Latest update
• The Times of India: LTCG tax relief on the cards? SEBI wants long-term capital gains tax to be removed for foreign investors