Strategic Fiscal Expansion: GIFT City Tax Incentives Doubled to 20-Year Horizon

In a decisive move to bolster India's financial competitiveness, authorities have extended the tax holiday for businesses operating within Gujarat International Finance Tec-City (GIFT City) from 10 to 20 years. This substantial fiscal enhancement, coupled with a proposed 15% tax rate on business income for International Financial Services Centre (IFSC) units post-deduction period, represents a calculated effort to position India as a premier global financial hub. The extension signals long-term governmental commitment to attracting foreign investment and fostering specialized financial services. Analysis indicates this policy shift aims to mitigate operational uncertainties for multinational corporations, thereby incentivizing sustained capital inflows and technological integration. The structured tax framework—combining extended relief with a moderate post-holiday rate—is designed to ensure fiscal sustainability while maintaining GIFT City's appeal against established offshore centers. This strategic recalibration underscores India's ambition to leverage its economic scale and regulatory agility, potentially reshaping regional financial flows and reinforcing GIFT City's role in cross-border financial intermediation.