One of the fundamental principles of taxation is neutrality. In finance this assumes significance since the decision to invest must not depend on tax. It is also true that any departure from neutrality must be grounded in sound economic purpose. Neutrality is desirable for well-functioning financial markets. Investment funds form an integral part of financial markets. These can operate through different structures and invest in different asset classes. Some of these funds can channel resources to sectors that are considered key for growth and development. Selecting AIF, REIT, InvITs and securitization trusts in India the tax system is compared for these and evaluated. It is found that the existing structure is not neutral and this article presents scope for policy change.