Tamil Nadu's AVGC-XR policy rebates the full cost of a studio's IP filings, capped at ₹20 lakh for international filings

Tamil Nadu's AVGC-XR Policy 2026 gives a company with a registered office and operations in the state a 100 per cent rebate on intellectual property filing and legal consultation costs, capped at ₹20 lakh for international filings and ₹8 lakh for domestic filings, per sanction, per company, per year ^[2]. Each company may claim up to five sanctions over the life of the policy, and copyrights, trademarks and patents covering the same IP count as a single sanction ^[2].

A second rebate covers half the cost of reaching a market, capped at ₹15 lakh per company per year across up to four applications a year, and limited to MSMEs and startups not more than five years old from incorporation ^[3]. Delegate and exhibitor passes, stall rentals, travel, visas and accommodation all qualify, against invoices certified by a chartered accountant ^[3].

Institutions get two rebates of their own: an institute running an AVGC-XR programme aligned with the new state curriculum may claim half the payroll cost of one Professor of Practice a year, up to ₹15 lakh, and half the cost of bringing industry experts in to train faculty across up to two programmes a year, to the same ceiling ^[4].

For events, the state has set aside up to ₹40 crore over five years, or ₹8 crore a year, to attract the organisers of major AVGC-XR conferences ^[5].

Above that the policy stops publishing rates. A large-scale company qualifies for the structured package if it employs at least 80 people in the A districts, which are Chennai, two taluks of Chengalpattu, two of Tiruvallur and Coimbatore City, or 40 people across the 15 entries in category B, and a mega-scale company needs 120 and 80 ^[6]. What those companies receive, from payroll and capital expenditure incentives to lease and rent support, stamp duty exemption, electricity tax and tariff incentives and a one-time green energy subsidy, is settled case by case on the investment proposed, the employment generated and the anchor impact on the state's ecosystem, and is paid at the end of each financial year for up to three financial years ^[7].

The package for MSMEs in between is the least specified in the document: it names its qualifying heads, among them training, certifications, intellectual property, GST refund on capital goods, innovation lab and licence costs, and attaches no rate, cap or ceiling to any of them, pointing instead to the incentives of the state's 2022 research and development policy ^[8].

The research money reported with the policy is a cross-sector fund: the policy describes a Research and Technology Fund with a corpus of ₹100 crore proposed in the state's 2021 industrial policy and 2022 research policy, being operationalised with an addition of ₹150 crore for private-sector research across sunrise sectors ^[9]. The ₹250 crore widely attached to the policy is those two numbers added together, which is this desk's arithmetic rather than a total the document prints ^[9].

The ₹50 crore attached to the Chennai centre is not in the policy either: the infrastructure section records that the Minister for Finance announced an ELCOT Viyan AVGC-XR Centre of Excellence in the 2025-26 Budget speech, as a Chennai hub with spokes at Coimbatore, Madurai, Tiruchirappalli, Salem and Tirunelveli over three years, and sets out the facilities for each phase without a cost ^[10]. ELCOT has since sought industry, academic and technology partners for the centre through an expression of interest, with a leased first-phase facility of 12,000 to 15,000 sq ft and a purpose-built second phase of about one lakh sq ft for around 500 professionals, The Hans India reported ^[17].

The one fund the policy does size is the Tamil Nadu Emerging Sector Seed Fund, a SEBI registered Category I alternative investment fund with an anchor investment of ₹50 crore, sponsored by TIDCO and TIDEL and managed by TNIFMC, which AVGC-XR companies may draw on alongside TANSEED, TANFUND, the state's SC and ST startup fund and a Digital Accelerator scheme offering up to ₹1 crore a startup ^[11].

ELCOT administers all of it: standard incentives are sanctioned and released through the corporation, and structured packages go from ELCOT to an inter-departmental committee and then to the cabinet ^[12].

The policy runs for five years from the date of its notification, with annual performance reviews and a mid-term review at the end of the second year, and the document prints no commencement date and no total outlay ^[13]. It was notified on 12 March 2026 through a government order of the Information Technology and Digital Services Department, Respawn reported ^[15].

Its stated targets are at least 200 AVGC-XR startups by 2030, a minimum of 100 companies in the state, about 20 per cent of the Indian market and about 2 lakh jobs ^[14].

The copy of the policy read for this piece is the full document published in the Tamil Virtual Academy's digital library, credited to the Information Technology and Digital Services Department and uploaded on 14 March 2026 ^[16].