On 12 June 2023, the Central Board of Direct Taxes (CBDT) issued notification 39/2023 determining the cost inflation index at 348 for the financial year (FY) 2023-24. The notification will come into force from 1 April 2024. The cost inflation index for FY 2022-23 is 331.
The cost inflation index is used to calculate capital gains on sales of long-term capital assets to account for inflation between the year of acquisition of the asset and its sale. Certain assets or taxpayers may not be eligible for the benefit of the cost inflation index.