New Delhi, March 21 (PTI): The government will soon issue 6-year taxable savings bonds offering an interest rate of 8 per cent without any investment ceiling from April 21.
The Centre targets to mop up Rs 6,500 crore through the new bond to be issued on an “on-tap” basis, finance ministry officials said.
The bonds will have a face value of Rs 100 and issued for a minimum Rs 1,000 and the interest would be payable half-yearly, an official release said.
As against the previous issue limiting investor to buy up to Rs 2 lakh, the new bonds would not have any investment ceiling.
Non-resident Indians would not be eligible for buying these bonds, the release said.
The bonds would not be allowed to be transferred or tradable or eligible for collateral for taking loans from banks and FIs.
Although the return from the bonds would be taxable under income tax, it would be exempt from wealth tax.
The move comes close on heels of the announcement of a new tax-free 5-year savings bond offering 6.5 per cent return to be launched on march 24 for domestic residents.
The government also announced last week a 5-year bonds offering 6.75 per cent tax-free return for US-64 investors from May.