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In a regulatory filing to the US Securities Exchange Commission dated May 18, ReNew Global mentioned tax liabilities due to indirect transfers if it “derives substantial value from assets located in India”.

Synopsis

According to tax rules, even share sales happening between two foreign entities are taxable in India if the shares belong to a company with significant business in the country. Hence, SPAC transactions attract capital gains tax of up to 44% in the hands of investors, tax experts said.

Mumbai: Going public via SPAC, or a special purpose acquisition company, might be a hot trend on Wall Street, but a capital gains tax levy introduced in the aftermath of the Hutch-Vodafone merger saga is making this an expensive option for Indian companies.

According to tax rules, even share sales happening between two foreign entities are taxable in India if the shares belong to a company with significant business in the country. Hence, SPAC

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Tax costs outweigh benefits of SPAC for overseas listing

By ariox