Big Boost To Employment And Entrepreneurship: Centre Mulling Fresh Tax Benefits For Startups In The Budget

With the intent of boosting growth and employment in the nation, the government is mulling on a fresh set of tax benefits for startups in the upcoming budget to be presented by the Finance Minister Nirmala Sitharaman on 5 July, reports Times of India.

A package of tax sops is said to have been deliberated upon by the revenue department and the department for promotion of industry and internal trade (DPIIT). The sops include simplified norms for levying a tax on employee stock option schemes (ESOPs) at the time of sale of shares.

The DPIIT is reportedly also exploring the possibility of extending the relief from angel tax to Category II alternate investment funds (AIFs), a treatment which, at present, is only accorded to few Category I investors.

Furthermore, a proposal is also believed to have been made for exempting the fund managers based in India of the Goods and Service Tax (GST). This assumes significance as the fund managers who are based offshore are not levied any such taxation. However, any decision on the subject is unlikely to feature in the budget as a decision pertaining to such exemption can only be made by the GST Council.