Removing Angel Tax and Inverted Duty Proposed Ahead of Budget 2024 in India 🚀
Ahead of the Budget 2024 in India, the Department for Promotion of Industry and Internal Trade (DPIIT) has made a recommendation to eliminate the Angel Tax for startups, as stated by Secretary Rajesh Kumar Singh. Additionally, the department has suggested phasing out the inverted duty structure and high tariffs on inputs in sectors like electronics.
Consultations with the Startup Ecosystem Drive Recommendations 🤝
- Based on discussions with the startup community, the department has previously proposed the removal of certain regulations and has reiterated this stance.
- Industry stakeholders believe that eliminating specific sections like Section 56(2)(viib) would significantly support capital formation within the nation.
Importance of Removing Angel Tax and Inverted Duty for Economic Growth 📈
- Angel Tax is imposed when a private company issues shares to investors at a value higher than its fair market price.
- In 2023, the Finance Act aimed to extend Angel Tax to non-resident investors starting April 1, 2024.
Industry Associations Advocate for Lowering Customs Duties 🛃
- Industry bodies have emphasized the need to decrease customs duties on inputs, citing it as crucial for economic growth.
- DPIIT supports the idea of phasing out the inverted duty and high tariffs on inputs, not just in electronics but in various sectors.
Hot Take: Empowering Startups Through Policy Changes 🌟
By recommending the removal of Angel Tax and restructuring of tariffs, DPIIT is taking proactive steps to empower startups and foster economic growth. These policy changes align with industry demands and could create a more conducive environment for entrepreneurship in India.
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