Gujarat International Finance Tec-City (“GIFT City”), is a major infrastructure project, Special Economic Zone (SEZ) and First International Financial Services Center, located in the state of Gujarat, India designed to attract businesses, especially in finance and IT. It offers tax incentives, regulatory support, world-class infrastructure, and a sustainable urban environment. It aims to establish an international financial and tech hub in India, enhancing the country’s global financial presence.
GIFT City boasts state-of-the-art infrastructure, modern architecture, and regulatory support designed to attract domestic and international businesses in the banking, finance, insurance, and technology sectors. With its SEZ and IFSC status, GIFT City provides several tax incentives and regulatory advantages, promoting business growth and economic development.
Through a strategic focus on capital markets, fund management, and insurance, GIFT City has attracted numerous leading financial institutions and insurance companies. In addition to its strength in traditional finance, the city has become a significant player in emerging sectors, including bullion trading, aircraft leasing, and ship leasing. It is also a sought-after destination for global in-house centers (GICs) and cutting-edge FinTech enterprises, which find an ideal ecosystem for innovation and growth.
To harness the potential of private equity, venture capital, alternative investment, family offices etc., IFSC Authorities issued International Financial Services Centres Authority (Fund Management) Regulations, 2022, overhauling the fund regime in IFSC and introduced Family Investment Fund (“FIF”) for managing family wealth and ensure its continuity.
FIFs offer a well-structured approach to wealth management, emphasizing transparency, governance, and tax efficiency as core tenets. FIFs require a minimum investment of USD 10 million within three years from registration and can be set up as a company, limited liability partnership, or trust.
Permitted FIF investments include various financial instruments, physical assets, and investment schemes. FIFs in GIFT City receive tax benefits, including a 100% tax exemption on prescribed business income for up to ten out of fifteen years and lower MAT/AMT rates. Additionally, they enjoy GST exemptions.
In summary, Family Investment Funds in GIFT City offer a sophisticated approach to wealth management, aiding in wealth preservation, capital growth, and supporting future generations. They promote diversification, tax efficiency, and long-term wealth continuity, providing a legacy of financial security and prosperity for multiple generations.
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