Union Budget 2022: Indian startups seek friendly policies, tax incentives
Highlight
- Budget 2022 should introduce favorable policies, tax incentives to help small businesses
- India has seen several startups in the last one year encouraging their employees to buy back ESOPs
- Startups expect the government to encourage capital formation in the area of logistics and cold chain
To further support small businesses and empower entrepreneurs, the Union Budget 2022-23 should include additional startup-friendly policies and tax exemptions to reduce spending on innovation, ease of doing business and compliance costs , said several domestic startups.
He stressed that the new reforms, policy support and support mechanisms to establish a focused approach in resolving unfulfilled financial needs through technology will greatly benefit the economy.
“We have seen a substantial increase in the adoption of digital payments in the last one year. I am hopeful that in the upcoming budget, the government will look at alternatives to the Zero MDR (Merchant Discount Rate) policy, as will the Razorpay CEO and Co-Founder. “Help to boost e-payments and drive significant digital adoption among businesses,” said Harshil Mathur.
In last year’s budget, Finance Minister Nirmala Sitharaman had announced Rs 1,500 crore to further accelerate the growth of digital payments in the country. Mathur said it would also be desirable for the government to increase the contribution to the Fund of Funds for Startups (FFS).
“Hassle free loan disbursement, automation of tax and compliance, paperless approvals, and incentives to adopt digital banking practices will also be welcome changes that can support the growth of MSMEs,” he said.
To encourage startups, the government last year extended the eligibility for claiming tax holiday for startups by one year to March 31, 2022. It has extended the capital gains exemption for investment in startups by one year to March 31, 2022, to boost funding. ,
In the last one year, several startups in the country have encouraged their employees to buy back ESOPs.
“The deferment of tax payment while exercising the option, as well as waiving off tax for certain ESOP receipts, would be a laudable change in the new budget,” Mathur said.
According to Raveesh Naresh, CEO and Co-Founder, KhataBook, they are looking forward to a progressive budget, especially aimed at promoting domestic startups focused on problem-solving for India.
“The economy will benefit immensely from new reforms, policy support and support mechanism to establish a focused approach to address unmet financial needs through technology,” Naresh told IANS.
In addition, the government’s continued focus on scaling up digital infrastructure in the country will ensure progress towards equity in digital access in FY22-23, he added.
In last year’s budget, the government had said that it would facilitate setting up of a world-class fintech hub in the city of Gujarat International Finance Tech (GIFT). The government also proposed a portal to collect relevant information to help prepare social security schemes for gig workers.
Vidit Atre, founder and CEO of homegrown social commerce platform Meesho, said the sole focus on scaling up offline MSMEs with online delivery could be a game-changing economic transformation opportunity.
“We want the government to focus on policies that create equal opportunities for offline and online sellers with a turnover of less than Rs 40 lakh,” Atre told IANS.
“Simplifying GST compliance requirements for online sellers will also enable millions of small businesses to leverage the potential of e-commerce and contribute to India’s growing digital economy,” he added.
In addition, startups expect the government to encourage capital formation in the area of logistics and cold chains through policies and infrastructure development.
Akash Gupta, co-founder and CEO of Zypp Electric, said they are hopeful that the government will announce new initiatives to encourage local EV manufacturing, facilitate easy finance and create an innovative EV ecosystem.
“We request the government to reduce the GST on EV purchase and rental from 5 per cent to 2 per cent. With reduced GST, consumers will be able to easily shift to EVs,” Gupta told IANS.
Indian startups raised a record $24.1 billion in 2021, a two-fold increase over pre-Covid levels, while 11 startups raised $6 billion through public markets with IPOs, a Nasscom-Ginov report said last week. went. The Indian tech startup base is witnessing steady growth, which is 600 more than in 2020, adding over 2,250 startups in 2021.
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