Finance Minister Nirmala Sitharaman tabled the Taxation and Other Laws (Amendment) Bill, 2026 in Parliament on August 7, 2026. The Bill replaces the June 5, 2026 Ordinance that provided income tax exemption to Foreign Portfolio Investors (FPIs) on income from interest and capital gains on investments in Government Securities (G-Secs). This follows India's inclusion in the JP Morgan Government Bond Index-Emerging Markets (GBI-EM) Global Diversified Index in June 2024 — a milestone that significantly increased FPI interest in Indian government bonds. India's G-Sec market exceeds ₹1,000 lakh crore. Tax exemption reduces government borrowing costs and attracts stable foreign capital.
Economy
Taxation and Other Laws (Amendment) Bill 2026 Tabled in Parliament — FPIs Exempt from Tax on G-Securities Income; Replaces Ordinance
Key Points
- Finance Minister Nirmala Sitharaman tabled the Taxation and Other Laws (Amendment) Bill, 2026 in Parliament on August 7, 2026
- The Bill replaces the June 5, 2026 Ordinance that provided income tax exemption to Foreign Portfolio Investors (FPIs) on income from interest and capital gains on investments in Government Securities (G-Secs)
- This follows India's inclusion in the JP Morgan Government Bond Index-Emerging Markets (GBI-EM) Global Diversified Index in June 2024 — a milestone that significantly increased FPI interest in Indian government bonds
- India's G-Sec market exceeds ₹1,000 lakh crore
- Tax exemption reduces government borrowing costs and attracts stable foreign capital
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• Taxation and Other Laws (Amendment) Bill 2026: tabled Parliament August 7; FM Nirmala Sitharaman • Replaces June 5, 2026 Ordinance; FPIs exempt from income tax on G-Secs interest + capital gains • Context: India included in JP Morgan GBI-EM Global Diversified Index (June 2024) • India G-Sec market: ₹1,000 lakh crore+; attracts FPI inflows; lowers government borrowing cost
