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Potential Equity LTCG Tax Cut Could Boost Foreign Inflows, Support Rupee: Jefferies

  • A Jefferies report suggests reducing India's equity Long-Term Capital Gains tax could improve foreign investor sentiment and support the rupee, as discussions around potential tax cuts have gathered pace.
  • Foreign portfolio investors have withdrawn USD 110 billion from India since April 2025, which Finance Minister Nirmala Sitaraman blamed on 'ease of liquidity, ease of availability' in domestic markets.
  • Financials recorded net FPI outflows of USD 16 billion between October 2024 and September 2026, while LTCG and securities transaction tax accounted for 8 per cent of direct taxes and 5 per cent of gross revenue in FY25.
  • Finance Minister Sitaraman called potential capital gains tax cuts a 'healthy debate to have,' though she remains noncommittal regarding specific changes in the forthcoming Budget.
  • Analysts at Jefferies prefer large-caps, which currently trade at a 23 per cent valuation discount to mid-caps, and favor Banks, Energy , Utilities, and Real Estate within oversold sectors.
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Potential equity LTCG tax cut could boost foreign inflows, support rupee: Jefferies

Read more about Potential equity LTCG tax cut could boost foreign inflows, support rupee: Jefferies on Devdiscourse.

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India Today broke the news in Noida, India on Wednesday, October 28, 2026.
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