Private equity investors puzzled over capital gains tax applicability

Seek clarity for gains made in IPO share sales

It’s been four months since the new tax on capital gains took effect. However, some sections are still puzzled over its applicability. Private equity (PE) investors have written to the Central Board of Direct Taxes (CBDT), seeking clarity on tax on gains made through sale of shares in recent initial public offerings (IPOs).
 
While the rules are clear for the listed space, with January 31, 2018, set as the reference day for computing cost of acquisition, there is still ambiguity on the unlisted space. As companies that are floating IPOs were unlisted as on January 31, their market price