A notification from the Indian government is expected to ease the statutory norms for startups in the embryo stage. Extending the major exemptions for up to 10 years, allowing sweat equity issuance of up to 50% of paid-up capital, relaxation in compliance norms, are among the changes proposed to boost the operational and financial capability of Indian Entrepreneurs.
Crux of the Matter
Department for Promotion of Industry and Internal Trade (DPIIT), earlier this year, amended the law to extend the recognition period of the startups for up to 10 years from incorporation.
Proposing changes in the Companies Act to create a thriving environment for startups, India is eyeing to relax them for 10 years from a regulation that restraints private companies from raising deposits more than 100% of their paid-up capital.
To boost the entrepreneurial spirit in the country, the Finance Ministry has also announced exemption from Angel Tax – a tax levied on investments acquired at more than fair market value.
Parliamentary approval for some changes like the exemption from filing CFS in annual returns and extension of the period of the board meeting to 6 months every 4 years and the others will likely bring efficiency in the operations of the startups.
Curiopedia
Make in India, a type of Swadeshi movement covering 25 sectors of the Indian economy, was launched by the Government of India on 25 September 2014 to encourage companies to manufacture their products in India and enthuse with dedicated investments into manufacturing. Its objectives include job creation and skill enhancement in multiple sectors and “to transform India into a global design and manufacturing hub”. As a result of investment interest generated by this movement, India emerged as the top destination globally in or foreign direct investment (FDI), surpassing the United States and China in 2015. It has also led to a steady increase in India’s rank in World Bank’s “Ease of Doing Business” rating, where currently it stands at 63, having improved by 79 ranks since 2014. Read More
Curated Coverage
Comments