Now Reading: Lok Sabha clears Bill boosting REIT tax flexibility, cash flows
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Lok Sabha clears Bill boosting REIT tax flexibility, cash flows
The Lok Sabha on Thursday cleared the Taxation and Other Laws (Amendment) Bill, 2026, allowing REIT special purpose vehicles (SPVs) to opt for the concessional tax regime while keeping dividend distributions tax-exempt…
The Story in Brief
The Lok Sabha on Thursday cleared the Taxation and Other Laws (Amendment) Bill, 2026, allowing REIT special purpose vehicles (SPVs) to opt for the concessional tax regime while keeping dividend distributions tax-exempt for unitholders. SPVs choosing this regime will pay a lower tax rate and will not have to pay Minimum Alternate Tax (MAT) going forward. They can also use accumulated MAT credits.
CFOs from Mindspace REIT and Embassy REIT say the Bill strengthens tax neutrality of the REIT structure and could improve distributable cash flows by reducing cash taxes at the SPV level. Embassy REIT estimates the provisions could restore the economic value of around Rs 592 crore in MAT credits already written off. The Bill now moves to the Rajya Sabha and then to the President for assent.
The Indian Opinion
Some may call this Bill a corporate giveaway. But tax neutrality is essential for REITs to stay attractive to retail and institutional investors. The MAT credit provision, Embassy REIT alone has Rs 592 crore, directly improves cash flows, not just accounting. Watch if the Rajya Sabha passes it without amendments that dilute these gains.
Source: cfo.economictimes.indiatimes.com
This story was synthesised by AI from the source linked above.
