Finance Bill: How will new Mutual Fund rules impact investors from April 1?

New Mutual Fund rules: All existing investments and new investments made in debt MFs before March 31 will not be affected by the proposed mutual fund tax change

The Centre amended the mutual fund rules in the Finance Bill, 2023, on Friday. The debt mutual fund (Debt MF) investors will no longer receive the long-term capital gain tax benefit. They will be taxed like bank deposits. It will be applicable from April 1.

The amendment to the Finance Bill was passed in Parliament today.

What are the current rules of taxation on mutual funds?

Currently, debt fund investments of over three years qualify for long-term capital gains tax. Their gains are taxed at 20 per cent with indexation benefits or 10 per cent without indexation. Investments of less