The Indian Income Tax Department has notified the Cost Inflation Index (CII) for the fiscal year 2026-27 at 384.
The index, which takes effect from April 1, 2026, serves as the official benchmark for adjusting the acquisition cost of capital assets to account for inflation when calculating long-term capital gains tax.
This annual notification directly impacts the tax liability for investors disposing of assets such as real estate, gold, and equities held for more than a year.
By indexing the purchase price to current inflation levels, the CII reduces the taxable gain, thereby lowering the final tax bill for sellers.
The move is widely viewed as a mechanism to preserve the real value of capital gains and encourage long-term investment in Indian markets.
The CII is a critical input for wealth management strategies in India, where capital gains tax rates can be significant.