n NISM Certifications
V-A NISM Series V-A
Medium

An investor in the growth option of debt-oriented mutual funds receives the benefit of ______ on long-term capital gains.

Practice question from NISM Series V A - Mock Test 3 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    Indexation

  2. B

    Tax exemption

  3. C

    Only A

  4. D

    Only B

  5. E

    Both A and B

  6. None of the above

    Correct answer

Why this is the answer

Under the Finance Act of 2023, the growth option of debt funds is now taxed as short-term capital gains (STCG), regardless of the holding period. Thus, there is no benefit of indexation or tax exemption for long-term capital gains.

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