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<ul><li>The Department of Industrial Policy and Promotion held a roundtable meeting with industry leaders on February 4. </li><li>A working committee has been assigned to resolve the issues related to <keyword id="6406536" type="UNKNOWN" weightage="20" keywordseo="Angel-Tax">angel tax</keyword>. </li><li>According to a survey, 73% of <keyword id="982553" type="PERSON" weightage="20" keywordseo="Indian-startups">Indian startups</keyword> have been served with angel tax notices. </li></ul>The Indian government is reportedly all set to take a decision on the angel tax issue that startups and investors alike have voiced against – within the next week. The step is expected to bring clarity to the country’s early stage entrepreneurs who say the rule has hurt their funding prospects. On Monday, the Department of Industrial Policy and Promotion (which recently got upgraded to be the Department for Promotion of Industry and Internal Trade) held a roundtable meeting with industry leaders from the Indian startup ecosystem to work on providing solutions for the angel tax issue, together. The meeting which was held with Indian Private Equity and Venture Capital Association (IVCA), angel investors and other leaders, saw the government take support from industry bodies to understand and implement changes that will be accepted by all. “We will form a smaller working group to come out with certain suggestions on resolving those issues in the next four-five days,” said Ramesh Abhishek, DIPP Secretary to the <a href="https://www.thehindubusinessline.com/economy/policy/working-group-to-examine-angel-tax-pain/article26176774.ece">media.</a> The angel tax issue had stirred up again after several startups were sent notices for the same. According to survey done by the IVCA, 73% of startups in India received <a href="https://yourstory.com/2019/02/indian-startups-angel-tax-notice/">Angel tax notices</a>. However, the DIPP secretary has said that no coercive action will be taken against these startups. In the last month, the government had introduced changes to tax laws under the Section 56(2) (vii b) of the Income Tax Act that will exempt ‘genuine’ investors in startups which are recognised by the DIPP. Till date, 15,278 startups have been recognised by the DIPP, while 129 startups have been funded under the Startup India program. Since the tax was introduced in 2012, Indian startups have claimed it has slowed down the funding at earlier stages because of the high tax rate. There have been several calls from the startup industry to remove the tax completely. The angel tax was added by the Indian government to prevent money laundering, however, over the years, entrepreneurs believe it has only become a hurdle in the funding stages. Siraj Dhanani, Co-Founder and CEO, InnAccel Technologies – which is into medtech manufacturing, told Business Insider previously, “Raising capital for startups working on affordable healthcare is already difficult, it is made more so by this angel tax, which is effectively a tax on Indian innovation." See Also: <a href="https://www.businessinsider.in/indian-government-just-added-a-lot-more-red-tape-for-startups-while-trying-to-fix-the-devilish-angel-tax/articleshow/67572452.cms">Indian government just added a lot more red tape for startups while trying to fix the devilish ‘angel tax’</a> <a href="https://www.businessinsider.in/indias-startups-wanted-a-breather-from-angel-tax-but-government-royally-ignored-them/articleshow/67794172.cms">Budget 2019 royally ignored India’s startups</a> <a href="https://www.businessinsider.in/the-indian-government-has-reportedly-invested-just-19-of-its-fund-dedicated-to-boosting-startups/articleshow/67323307.cms">The Indian government has reportedly invested just 19% of its fund dedicated to boosting startups</a>

Indian government to take a stand on angel tax within a week

<ul><li>The government has announced in what it believes are easier processes for startups to claim exemption from <keyword id="6406536" type="UNKNOWN" weightage="20" keywordseo="Angel-Tax">Angel Tax</keyword>. </li><li>Startups incorporated before April 2016 can also apply for exemption. </li><li>However, startups need to be recognised by <keyword id="6391107" type="UNKNOWN" weightage="20" keywordseo="DIPP">DIPP</keyword> for the same.</li></ul>Indian startups have long been fighting the demon that came into their lives with the ‘angel <keyword id="45031" type="PERSON" weightage="20" keywordseo="Tax">tax</keyword>,’ which requires them to pay up for money they received from early investors. Now, the government has introduced changes to tax laws under the Section 56(2) (vii b) of the Income Tax Act that will exempt ‘genuine’ investors in recognised startups – but not without another red tape. They have to be registered with the government’s Department of Industrial Policy and Promotion (DIPP) in order to get the exemption. The angel tax, which was introduced in 2012, mandated that angel investments should be treated as “income from other sources” if the <keyword id="138263" type="PERSON" weightage="20" keywordseo="startup">startup</keyword> issues shares at a price that exceeds the fair market value of the shares. The Indian government believes it is now providing a simpler mechanism to claim exemption from the tax. While earlier, exemption from this tax was available only for startups incorporated after 2016 under the government’s ‘Startup India program’ – a much-touted initiative of the Modi government to boost entrepreneurship. “All previous and future investments are covered, startups incorporated before April 2016 also covered,” DIPP secretary Ramesh Abhishek told <a href="https://economictimes.indiatimes.com/small-biz/startups/newsbuzz/angel-tax-wont-haunt-startups-any-longer/articleshow/67566526.cms">Economic Times.</a> Since the launch of the Startup India program, 15,113 companies have been recognised under DIPP; India is home to a total of over 40,000 startups until June 2018 according to a <a href="https://yourstory.com/2018/06/presenting-india-startup-report-yourstory-overview-startup-ecosystem/">YourStory report</a>. With the new rule in place, DIPP-recognised startups applying for the exemption to the Central Board of Direct Taxation will be able to get an approval in 45 days. All in all, the rule becomes another added layer of bureaucratic hoops that startups now have to jump through, even though culturally speaking, a startup’s way of functioning is very different than that of a typical ‘registered company’. Experts believe that investments in a startup by an individual is a commercial decision that needs to be treated like one. “The government’s intent is to check if anyone is misusing the methodology for money laundering. If the source of the money is not tainted then why should there be an angel tax,” said Ved Jain, a tax expert and past president of The Institute of Chartered Accountants of India. The question that most experts are weighing in on is – why do we really need an angel tax? By implementation of the rule to register under DIPP, the government gets a say on how and when you startup – and that might not exactly be the ‘ease’ of doing business that the government is promoting. “Why are we moving with a presumption that whichever company is receiving the share capital with a difference in the fair market value, there is something wrong with the deal. There has to be a difference between a commercial and government decision. However if there is an allegation that it has been misused, only then additional rules should be implemented,” said Jain. See Also: <a href="https://www.businessinsider.in/the-indian-government-may-roll-back-a-tax-on-angel-investments-that-is-said-to-be-hurting-the-countrys-startup-ecosystem/articleshow/67177981.cms">The Indian government may roll back a tax on angel investments that is said to be hurting the country’s startup ecosystem</a> <a href="https://www.businessinsider.in/the-indian-government-has-reportedly-invested-just-19-of-its-fund-dedicated-to-boosting-startups/articleshow/67323307.cms">The Indian government has reportedly invested just 19% of its fund dedicated to boosting startups</a> <a href="https://www.businessinsider.in/taxed-for-being-an-angel-several-start-ups-wont-benefit-even-as-angel-tax-is-revoked-say-experts/articleshow/52831043.cms">Taxed for being an ‘angel’? Several start-ups won’t benefit even as angel tax is revoked, say experts</a>

Indian government just added a lot more red tape for startups while trying to fix the devilish ‘angel tax’

<ul><li>At the event, former RBI governor Raghuram Rajan has said that India will soon surpass the size of China’s economy. </li><li>IMF Chief Gita Gopinath has raised the red flag for India by calling out the risk associated with India’s high fiscal deficit. </li><li>While Indian political leaders may be missing, industry top honchos Ambani, Adani among others are making up for the country.</li></ul>It’s that time of the year when the world’s biggest political, business and thought leaders of the world sit down and discuss global economy, investments, climate change and other pressing issues and potential opportunities at the famous skiing destination in Switzerland-- Davos. The <keyword id="69007" type="COMPANY" weightage="20" keywordseo="World-Economic-Forum">World Economic Forum</keyword> has officially kicked off in Davos and unlike last year, where Indian prime minister Narendra Modi made a splash, most political leaders from India have pulled out of the event to focus on the upcoming general elections. However, India, an economy that is touted to be among the world’s <a href="https://www.businessinsider.in/india-to-overtake-the-uk-in-the-rankings-of-the-worlds-largest-economies-thanks-to-brexit/articleshow/67188514.cms">top five</a> in 2019, was certainly a talking point at the world’s most elite gathering. The buzz at Davos Indian economy can be bigger than China Former RBI governor <a href="https://www.thequint.com/news/business/india-to-become-bigger-than-china-eventually-raghuram-rajan">Raghuram Rajan </a>has made big predictions for India at the event. Rajan said that India will soon surpass the <keyword id="5639169" type="UNKNOWN" weightage="20" keywordseo="economy-of-china">economy of China</keyword> and will lead the infrastructure development in South Asia. “India will become bigger than China eventually as China would slow down and India would continue to grow. So India will be in a better position to create the infrastructure in the region which China is promising today. But this competition is good for the region and it will benefit for sure,” he said. IMF’s advice for India’s finance minister IMF's Chief Economist Gita Gopinath has raised the <a href="https://www.bloombergquint.com/davos-world-economic-forum-2019/davos-2019-imf-chief-economist-gita-gopinath-on-global-growth-and-indian-economy#gs.3GOc0UrB">red flag for India</a> by calling out the risk associated with India’s high fiscal deficit. In an exclusive interview with <a href="https://economictimes.indiatimes.com/markets/expert-view/india-must-stick-to-fiscal-math-gita-gopinath-imf/articleshow/67634713.cms">ET now</a>, the IMF Chief said, “It is important for India to stay the course on fiscal consolidation. If you look at the aggregate deficit for India – combining the centre and the state deficits – has not improved much in the last five years. That is something that needs to be addressed.” However, The International Monetary Fund's (IMF) World Economic Outlook Update released by chief economist Gita Gopinath on Monday said that India's economy is expected to grow by 7.5 per cent in the 2019-20 fiscal year, keeping an upward trajectory as the rest of the world slumps. India to lead Industry 4.0 India presents a big opportunity with the fourth industrial revolution, declared Department of Industrial Policy and Promotion (DIPP) Secretary Ramesh Abhishek. Speaking at a breakfast session titled 'Shaping India's future with Industry 4.0', organised by global consultancy giant Deloitte and industry body CII, the secretary said that India is fast adapting to new technologies and facilitating with policy framework to make way for industrial growth. ‘Chai pe charcha’ at Davos Indian tea is making a big appearance at the event with<a href="https://www.livemint.com/politics/news/from-hot-cups-of-tea-to-billboards-and-lounges-india-makes-a-mark-at-wef-1548080851695.html"> Tata Tea’</a>s participation at the WEF. The company is offering free cups of tea to the attendees of the event. 
 



 
 
 <div type="image" title="WEF" msid="67652758" hostid="261" caption="&amp;lt;p&amp;gt;Tata Group Chairmen, Mr. Chandrasekaran at World Economic Forum. &amp;lt;/p&amp;gt;"></div>







easyinv.blogspot.com Neighbours compete At the WEF too, rival states of Telangana and Andhra Pradesh are making their call for investments. While Telangana makes an appearance again this year asking investors to make the state their first stop in the country, sister state <a href="https://www.livemint.com/politics/news/from-hot-cups-of-tea-to-billboards-and-lounges-india-makes-a-mark-at-wef-1548080851695.html">Andhra Pradesh</a> is calling itself ‘future-ready,’ Andhra Pradesh Chief Minister Chandrababu Naidu, too, was supposed to attend the event but he’s passed the opportunity. What to expect Many Indian industry top honchos like Mukesh Ambani, Gautam Adani, Nandan Nilekani, Anand Mahindra, Pawan Munjal amongst others will be making an appearance at the event. Indian commerce and industry minister Suresh Prabhu will also be attending the event. Madhya Pradesh Chief Minister Kamal Nath will be speaking on emerging markets outlook on Day 3. See Also: <a href="https://www.businessinsider.in/indias-economy-projected-to-grow-the-fastest-in-the-2019-20-even-as-the-rest-of-the-world-slows-down-imf/articleshow/67633816.cms">India's economy projected to grow the fastest in the 2019-20 even as the rest of the world slows down: IMF</a> <a href="https://www.businessinsider.in/davos-2019-day-one-huawei-chairman-said-trade-war-is-slowing-sales-microsoft-ceo-talked-techs-impact-on-humanity/articleshow/67649167.cms">Davos 2019 Day One: Huawei chairman said trade war is slowing sales, Microsoft CEO talked tech's impact on humanity</a> <a href="https://www.businessinsider.in/india-supports-international-aid-to-other-countries-says-survey/articleshow/67634798.cms">Over 95% Indians support foreign aid efforts — and it seems like India has stood up to that expectation</a>

Davos Digest: Raghuram Rajan lifts India's spirit and other stories from the World Economic Forum

It is clear from various initiatives taken up by the government ever since it came in power that they want to project India as one of the best countries to do business in and to do business with. Therefore the <keyword id="6354424" type="ORGANIZATION" weightage="20" keywordseo="World-Bank">World Bank</keyword>'s 'ease of doing business' survey 2018 which is slated to be released on October 31 is something that the government is eagerly waiting for. The report is likely to give a clearer view of where India stands in terms of ‘ease of doing business’ compared to other countries. Top officials in the government have reason to believe that India's ranking may improve significantly in the World Bank's ease of doing business report on the back of reforms initiated by the government. "We have worked very hard so we are definitely expecting," <keyword id="6391107" type="ORGANIZATION" weightage="20" keywordseo="DIPP">DIPP</keyword> Secretary <keyword id="254331" type="PERSON" weightage="20" keywordseo="Ramesh-Abhishek">Ramesh Abhishek</keyword> told when asked if the country's ranking would improve. "The World Bank's Doing Business report is going to come out on 31 October and we hope to see a significant improvement because of the large number of work that we have done," Abhishek said. <keyword id="130694" type="ORGANIZATION" weightage="20" keywordseo="Commerce-and-Industry">Commerce and Industry</keyword> Minister <keyword id="6356597" type="PERSON" weightage="20" keywordseo="Suresh-Prabhu">Suresh Prabhu</keyword> had recently hinted about the same, saying the country would soon hear "good news" on the ease of doing business front. The government's optimism regarding the improvement in India's rank comes on the back of reforms taken to improve the efficiency in granting construction permits, starting a business and resolving insolvency. The ease of doing business ranking is taken seriously by participating countries as they believe it plays a key role in helping foreign investors decide where to invest. In the last three-and-a-half years, India has received foreign direct investment (FDI) of above USD 170 billion, the DIPP secretary pointed out. India's rank inched up by just one place to 130 in the last year's survey that measures the ease of doing business in various countries

Will India’s ranking in ‘ease of doing business’ improve? Government anticipates a “good news”

A dedicate portal and a mobile application would now let Indian start-ups register themselves online in a single day. Not only this, they would also be able to know about all the incentives that the government can offer to them under the Start-up India Action Plan. 
 
The portal and app, developed by the Department of Industrial Policy and Promotion (DIPP), would be launched within a week. It would provide all information about tax benefits and incubation facilities that the government provides, would serve as a single point of contact for clearances, approvals and registrations. 
 
"This is part of our effort to create a conducive environment for start-ups. It will facilitate easy exchange of information between all stakeholders," a senior official told ET. 
 
Later, the portal would be equipped to get the companies registered under the Companies Act. 
 
The launch has come right when promised by PM Modi, when he announced the Start-up India Action Plan in January and said that a portal and app dedicated for start-ups will be launched on April 1. 
 
As for the interest of the stakeholders, the portal would bring all stakeholders, including start-ups, incubators, accelerators, venture capital funds, seed capital funds, angel investment funds and government functionaries under one roof. 
 
<a href="http://media.newindianexpress.com/modi_finger.jpg/2013/04/26/article1561640.ece/alternates/w460/modi_finger.jpg">Image source</a>

Next week onwards, register your start-up with in one day

<keyword id="6354427" type="CITY" weightage="20" keywordseo="Apple">Apple</keyword> has sought permission from Department of Industrial Policy and Promotion (<keyword id="6391107" type="ORGANIZATION" weightage="20" keywordseo="DIPP">DIPP</keyword>) for opening its own stores in India. 
 
The proposal has been sent to DIPP, however, there is no mention of the investments. 
 
Apple wants to make the most of foreign direct investment rules on single-brand retail. 
 
Apple, whose sales in India crossed $1 billion the year ended March 2015, is focussing in India. It is expanding retail network and going aggressive on marketing. 
 
According to results filed with the Registrar of Companies, Apple posted 44% increase in sales at Rs 6,472.89 crore for 2014-15, up from Rs 4,500.35 crore a year earlier, and its net profit doubled to Rs 242.85 crore from Rs 119.48 crore. 
 
(Image: Reuters)

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Indian government to take a stand on angel tax within a week

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Indian government just added a lot more red tape for startups while trying to fix the devilish ‘angel tax’

Sanchita Dash

Davos Digest: Raghuram Rajan lifts India's spirit and other stories from the World Economic Forum

Sanchita Dash

Will India’s ranking in ‘ease of doing business’ improve? Government anticipates a “good news”

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Next week onwards, register your start-up with in one day

BI India Bureau

Soon buy your iPhone and iPad at your own swanky neighbourhood Apple store in India!

BI India Bureau

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