It is known fact that startup forms strong foundation in building nations economy. If encouraged in a right manner, these startups have the ability to turn themselves into a full fledged business company thereby helping respective nation in building economical opportunities. However, when it comes to India, the situation is quite different. An entrepreneur has to face several hurdles starting with registering his company.
With the new government in place, the situation is about to change. The Indian government is believed to be working on a draft that will exempt startups from excise duty and service tax for a specific period. If this comes true, startup companies would definitely have less burden with respect to money issues and that might just help them in kickstarting really well.
As per the report from Economic Times, an inter-ministerial group has been formed that is examining the one-stop registration scheme which will further make them eligible for government grants. The group currently includes Ministry of Science and Technology, Corporate Affairs, and the department of electronics and IT. It is currently being headed by Jayant Sinha who is Minister of State for Finance. The proposal is still under construction and could perhaps make its way within a year.
The official scheme details are still unknown to us but we are learning from our sources that companies registered under the department of science and technology, would be elevated and certified as “bonafide” and this will further allow them to be exempted from the above mentioned taxes. Currently companies are paying 12.36 % of service tax and there is some added excise duty plus income tax. If the proposal is brought into the action, companies under this scheme would be eligible for a grant of Rs 10 core from department of science and technology.
It is well known fact that startups in India are still facing number of obstacles and the process out there is pretty messy. The new proposal seems quite good on paper and if it is enacted as mentioned, the environment would certainly be in the favor of these startup companies. Not to mention, this will further benefit common man living in this country. It will be interesting to see the future steps of Indian government with this regard and that definitely means that my eyes are going to watch out for any further developments. Till then, keep working on startup ideas. Adios!