MCQ
Taxation and Capital Markets MCQ - Practice Questions with Answers
Solve 1 Taxation and Capital Markets questions for RAS/RPSC preparation.
Practice questions
Q1Consider the following statements regarding the income tax exemption granted to Foreign Portfolio Investors on Government Securities:\n1. The exemption covers only capital gains, not interest income from G Secs.\n2. The exemption is effective from 1 April 2026.\nWhich of the statements given above is/are correct?
Explanation
Statement 1 is incorrect because the exemption covers BOTH interest income and capital gains arising from FPI investments in Government Securities, not capital gains alone. Statement 2 is correct as the tax exemption is effective from 1 April 2026. The measure was announced alongside the RBI FAR expansion to attract long term foreign capital into the Indian bond market.
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