The Finance Minister called start ups the drivers of growth for the economy
01 Feb 2022 | 5905 Views | By Nilesh Wadhwa
The Union Budget 2022, recognising the significant importance of nurturing the start-up ecosystem, has given them an extension for another year.
Describing them as “drivers of growth for our economy”, the finance minister, Nirmala Sitharaman in her speech said that new start-ups which were given tax incentives for the ...
This is an Autocar Pro Plus article. Subscribe to continue reading.
The Union Budget 2022, recognising the significant importance of nurturing the start-up ecosystem, has given them an extension for another year.
Describing them as “drivers of growth for our economy”, the finance minister, Nirmala Sitharaman in her speech said that new start-ups which were given tax incentives for the first three years of their incorporation will now be extended to four years. This is in taking into account the pandemic-induced fiscal challenges that start-ups faced.
Earlier, start-ups that were incorporated between April 1, 2016 and March 31, 2022 were eligible for a 100 percent tax rebate. The eligibility now has been extended by a year to March 31, 2023. The beneficiaries can now avail 100 percent tax rebate for a period of three consecutive years out of ten years from incorporation.
Venture capital investors and start-up founders will benefit from a tax tweak on the surcharge on long-term capital gains (LTCG) tax, which has been capped at 15 percent for all listed and unlisted companies.
The Economic Survey tabled on 31 January, states that start-ups in India have grown remarkably over the last six years. The number of recognised start ups was 14,000 in the ongoing fiscal as against 733 in 2016-17. As a result, the survey said, India has become the third largest start-up ecosystem in the world after the USA and China. Further, a record 44 Indian start-ups have achieved unicorn status in 2021 taking the overall tally of unicorns in India to 83, most of these operating in the services sector.