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Feb 04, 2026
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Extended tax holiday to drive GIFT City office demand, realty development
The government’s move to extend the tax holiday for units in GIFT City to 20 years is expected to significantly boost demand for office space, accelerate commercial real estate development and improve long-term leasing visibility at India’s only International Financial Services Centre (IFSC).
By doubling the tax deduction period for IFSC units and offshore banking units (OBUs), the government has provided long-term fiscal certainty, supporting larger office commitments, campus-style developments, and sustained absorption of Grade A commercial space.
Under the proposed amendments to the Income-tax Act, IFSC units will be eligible for a 100% deduction on specified incomes for 20 consecutive years out of a 25-year block, compared with the earlier 10-year window. After the deduction period, business income from IFSC operations will be taxed at 15%, versus 35% for overseas companies elsewhere in India.
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