No Effect On Startups Due To “Angel Bill” Provisions In Finance Bill

No Effect On Startups Due To "Angel Bill" Provisions In Finance Bill

The ‘angel duty’ provision in the Finance Bill won’t impact startups in India, a senior government functionary said on Tuesday. Startups which are registered with the Department for Promotion of Industry and Internal Trade don’t come under the horizon, Anurag Jain, the secretary in the department said while speaking at the IBVCA Conclave then. “It does not affect startups in the least,” he said, addressing the followership at the event organised by the adventure capital assiduity lobby grouping. 

He said there’s a “clear provision” which says that startups which are honoured by SPIRIT are out of the offer’s horizon, and added that the incipiency recognition process is also veritably simple where any aspirant gets it automatically.

The proposed regulatory changes in the Finance Bill through the modifications to Section 56 (2) VII B of the Income Tax Act alarmed startups. Foreign investors are also proposed to be included in the dimension of taxation, wherein an incipiency raising backing from a foreign investor will also be liable to pay income tax if the finances are entered above the face value of shares.

Without specifying, Jain said there are other issues which have been raised by the adventure investing community and the same have been put forth before the Department of Revenue for a review. 

He said we need to look at how to rally domestic capital further into the startups and new-age companies. There have formerly been changes on this front, including allowing long-term pension and insurance finances to invest in indispensable investment finances.

He said by 2047, India will be an advanced country and a realistic estimate pegs the size of the frugality to be USD 30 trillion which can be the second biggest in the world.” Growth will be driven by knowledge, sustainability and invention,” he said, adding that startups give the right results across all three.

In 2022, adverse geopolitical events followed by macroeconomic headwinds resulted in a fall in the backing for Indian startups, Jain said, stressing that the country is fairly better placed when compared with others.

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