How does the Union Budget 2022 look for NRI investors?
Is it worthwhile for NRIs to invest for the long term? The budget effectively proposed to provide impetus to various industries to achieve target growth. There have not been significant changes in the tax structure and it remains the same as the NRI income tax slab 2021-2022. Let’s look at the Impact of budget 2022 on NRI Investors.
With this budget, the government aims to promote digital economy, fintech, tech-enabled development, energy transition, and climate action. The cult of cryptocurrency was given importance in the budget but an unprecedented steep tax rate of 30% has been proposed for the gains thereof. In addition, loss from the transfer of virtual digital assets can’t be set off against other income. TDS at 1% will be levied at the time of transfer exceeding a certain amount of money i.e. Rs. 50000 for specific individuals and Rs. 10,000 for others.
Here are some of major takeaways for NRI investors –
1. Surcharge on tax on long term capital gains on unlisted shares, property, artifacts, etc. has been capped at a flat rate of 15%.
2. Investors looking at creating a zero net portfolio will be happy to hear about the plans to issue “green” bonds that will be used to raise funds to finance green infrastructure.
3. To support the startup ecosystem to gain traction, a separate committee will help recommend measures to clear regulatory hurdles in scaling up Venture Capital and Private Equity investments.
4. Funding for digital economy, agri-tech, deep-tech will be boosted through National Investment and Infrastructure Fund and SIDBI (government-backed funds).
5. Eligible startups that are incorporated in FY2023 will get tax incentives.
6. The International Financial Services Center will add new services for foreign investors.
7. Post the successful complete disinvestment of Air India for INR 18000 Cr., the government is now considering launching LIC’s IPO and other divestment options in FY 2023.
It is evident from the points mentioned above that the Union Budget 2022 gives importance to investors who are looking at long-term stable investments in India based on technology, infrastructure, and real estate.
So, have you started planning to invest in India and make changes in your portfolio yet? What major changes do you think you are going to make in your portfolio for the upcoming 5-10 years? What are the parts of your portfolio yet, whether commercial real estate, pre-IPO or micro VC funds?
If you are confused or reluctant about investing in India due to lack of understanding of the Indian market, SBNRI will help you build a stable portfolio in an easy way.
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