Equity Linked Savings Schemes (ELSS) are equity-focused mutual funds with a three-year lock-in. Due to this lock-in, there is no short-term capital gains tax, while in FY27, long-term gains will be taxed at 12.5% above ₹1.25 lakh. ELSS investments also qualify for a deduction of up to ₹1.5 lakh under Section 80C for those opting for the old tax regime.