Angel tax relief for startups: Funding cap for exemption raised to Rs 25 cr

Source: Business Standard, Feb 20, 2019

New Delhi: Bowing to sustained pressure from start-ups and venture capital funds over the so-called angel tax, the government on Tuesday eased tax norms for new businesses in a bid to boost investment and job creation.

The angel tax is levied on start-ups that have received equity infusion in excess of the fair valuation, with the premium being paid by investors as their income. It was introduced in the 2012-13 Budget by the then finance minister Pranab Mukherjee to curb money laundering.

The government has allowed start-ups that have raised capital up to Rs 25 crore to claim tax benefits, as against Rs 10 crore earlier. It has also announced a slew of waivers and a definition tweak in line with demands from the sector. Exemptions have been allowed for investments by non-resident Indians and alternative investment funds (AIFs) as well as for the infusion of capital into start-ups in the form of equity stake in a listed company, according to the latest norms issued by the Department for Promotion of Industry and Internal Trade (DPIIT). Read the rest of this entry »

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Govt reduces allocation for Startup India in FY’20 Budget

Source: The Hindu Business Line, Feb 03, 2019

New Delhi: The government has reduced the allocation for Startup India programme in the Budget 2019-20 but added more monies to the ‘Make in India’ kitty. According to the budget documents, the allocation for Startup India programme has been slashed to Rs 25 crore for 2019-20 from the revised estimate of Rs 28 crore in 2018-19.

Startup India initiative aims at fostering entrepreneurship and promoting innovation by creating an ecosystem that is conducive to growth of budding entrepreneurs.

There are 19 components under the Startup India action plan spanning across areas such as simplification and hand holding, funding support and incentives, and industry-academia partnership and incubation, according to the documents. Read the rest of this entry »

India’s biggest start-up incubator opens at Kochi

Source: Business Standard, Jan 14, 2019

Kochi: Kerala Chief Minister Pinarayi Vijayan on Sunday inaugurated in Kochi the country’s biggest start-up incubator.

Housed in a 180,000-lakh square-feet facility, it has incubation setups across a string of segments in modern technology.

The Integrated Startup Complex, set up under the Kerala Startup Mission (KSM), has ultra modern facilities, like “Maker Village” dedicated to promotion of hardware startups, “Bionest” for promoting medical technologies, BRINC which is the country’s first international accelerator for hardware startups, BRIC which aids developing solutions for cancer diagnosis and care, and a Centre of Excellence set up by the industry majors.

“Overall, the Kerala government is working for the state to have a total area of 23 million sq.ft of IT space (up from 13 million sq.ft last year). We are also planning to give direct jobs to 250,000 lakh in IT,” said Vijayan and added that the government is working to ensure that information technology fosters social development. Read the rest of this entry »

Venture capital funding frenzy in B2B startups may continue in 2019

Source: LiveMint.com, Jan 09, 2019

Mumbai: Venture capital investments in business-to-business (B2B) startups set new records in 2018, investors said, adding with access to large global markets and growing focus on artificial intelligence, 2019 could be even bigger.

According to venture capital data firm Tracxn, 2018 saw investments of $3.09 billion in B2B startups across 415 rounds, 28% more than the $2.41 billion allocated in 2017, across 534 rounds.

Fewer rounds and bigger values also point to large deal sizes, as investors focus on a few winners from each segment.

“Unlike B2C, a software or deep tech startup can begin with customers abroad. Their market is much bigger right from the beginning,” said Sanjay Nath, managing partner, Blume Ventures. Read the rest of this entry »

Logistics start-ups attract $1.89-b investments in 2018

Source: The Hindu Business Line, Dec 26, 2018

Fuelled by growth in sectors such as manufacturing, retail, e-commerce, food delivery and consumer goods, along with the implementation of the Goods and Services Tax (GST), the demand for logistics and supply chain solutions in India is also on an upward trajectory.

Once considered unattractive by the venture capital firms globally, the logistics sector, largely driven by the use of future technology, has become the darling of global investors, including SoftBank, Sequoia and Tiger Global.

The start-ups playing in the digitally-driven logistics and supply chain space in India have attracted investments worth $1.89 billion, till date, in 2018, according to a data provided by start-up research platform Tracxn Labs. This is a major increase from the $77-million funding that the segment received in 2014, which was also the period that witnessed emergence of some currently popular logistics start-ups, such as Rivigo, XpressBees, and Swiggy, among others. Read the rest of this entry »

Government announces fresh steps for Start-ups

Source: The Economic Times, Dec 20, 2018

NEW DELHI: India on Thursday announced fresh steps to address tax issues faced by start-ups in the country.

A panel of eminent technical experts from IITs and IIMs will be set up soon to draw up a new framework for recognition of start-ups as also premium charged by them on their shares.

Apex direct taxes body, the Central Board of Direct Taxes, has said no coercive action to recover the tax demands even in cases where assessments have been completed under Income Tax would be taken.

These decisions were taken at a high-level meeting on Thursday held by Revenue Secretary Ajay Bhushan Pandey, Department of Industrial Policy and Promotion Secretary Ramesh Abhishek and CBDT chairman Sushil Chandra.

AIM expects 5,000 startups to come out of 101 incubators in next 4 years

Source: Business Standard, Nov 10, 2018

Hyderabad: Atal Innovation Mission expects about 5,000 startups to come up in the next four years from incubators that it is planning to launch in various institutions across the country, R Ramanan, Mission Director, Atal Innovation Mission under NITI Aayog, said on Friday in Hyderabad.

“We are setting up 100s of world class incubators in universities and institutions across the country. We have launched 101 incubators of which 30 are operational already and the rest will be operational by the end of next year,” he said.

Each of these incubators will foster at least 25 to 30 startups every two years, Ramanan said adding funding of Rs 100 million is being given to each incubator to provide necessary support to the startups.

The idea is, over 5,000 startups would now come out of these 101 incubators over the next four years, he told reporters on the sidelines of the two-day “The Things Conference”. Read the rest of this entry »