PE, VCs seek one-time tax holiday to tide over Covid-induced crisis

Want no long-term capital gains tax for two years on investments held for 36 months; EY India sees 45-60% contraction in Indian PE/VC investment activity this year from record highs of 2019

Private equity (PE) players are seeking a one-time tax holiday from the government amid a steep decline in investment and fundraising activities since the outbreak of Covid-19.

Industry body Indian Private Equity & Venture Capital Association (IVCA) has written to the government, asking for a one-time exemption from long-term capital gains (LTCG) tax on private equity investment for two years. 

This shall apply only to primary investments, for securities that are held for at least 36 months, and valid for investments made within two years from the date of grant of the exemption. Domestic funds and broad-based global funds should be