India must rationalise LTCG on equities for foreign investors, says EisnerAmper CEO Charley Weinstein

Global accounting and investment advisory firm EisnerAmper Global called for rationalisation of long-term capital gains (LTCG) tax on equities in India, as it is impacting post tax returns for foreign investors. The firm said depreciation in the rupee is also compounding the impact on the global investors.

“The increase in LTCG tax on listed equities from 10% to 12.5% in July 2024 has a direct bearing on post-tax returns. For foreign investors, this impact is compounded by rupee depreciation, which can further reduce the value of returns when converted into their home currencies,” said Charly Weinstein, CEO, EisnerAmper Global in an exclusive interview with Fortune India.

“There is a need to rationalize long-term capital gains tax rates to maintain the attractiveness for long-term investors. At a time when global investors compare opportunities across markets, the combined effect of taxation and currency movements matters. A more competitive and predictable tax structure would strengthen investor confidence and support sustained capital flows,” Weinstein added.

What more tax reforms must India undertake?

Weinstein said India’s next phase of reform should place simplicity, certainty and consistency at its centre. “Faster dispute resolution, streamlined compliance, clear cross-border tax rules and predictable transfer-pricing frameworks would help businesses plan and invest with greater confidence,” he said.

Weinstein said India tax policy must continue to encourage innovation, entrepreneurship and the growth of high-value services. “Continued investment in infrastructure, skills, technology and global trade connectivity will also strengthen India’s competitiveness. At the same time, policy should encourage innovation, entrepreneurship and the growth of high-value services, enabling Indian businesses and global companies operating in India to move further up the value chain,” he said.

“The objective should be to create an environment in which businesses can establish, invest, operate and grow over the long term. Consistency in policy implementation will be an important differentiator as India competes for global capital,” he added.

Weinstein said India is moving up the value chain as global capability centres evolve beyond operational support into technology, analytics, finance and strategic decision-making. “This creates opportunities for investment across sectors and across the professional services landscape. To strengthen its position further, India should continue investing in infrastructure, specialised skills and global connectivity, while maintaining regulatory consistency and policy predictability,” he said.

“The opportunity is to establish India not simply as a destination for global operations, but as a centre from which businesses innovate, build capabilities and serve international markets,” he added.