Budget 2019: FM Nirmala Sitharaman proposes to start DD channel for start-ups
Budget 2019: She said the channel will serve as a platform for promoting start-ups, discussing issues affecting their growth, matchmaking with venture capitalists and funding and tax planning.
Budget 2019: In the budget 2019-20, Finance Minster Nirmala Sitharaman has given special thrust on start-ups. In one such proposal, she said the government proposes to start a channel within the DD bouquet of channels, exclusively for start-ups. Presenting her maiden budget today in Parliament, she said the channel will serve as a platform for promoting start-ups, discussing issues affecting their growth, matchmaking with venture capitalists and funding and tax planning. Notably, this channel will be designed and executed by start-ups themselves.
Other key highlights related to start-ups in the budget are:
1. According to the Finance Minster, the condition for carry forward and set off of losses in cases of eligible start-ups is proposed to be relaxed enabling them to carry forward their losses on satisfaction of any one of the two conditions - continuity of 51% shareholding/voting power of continuity of 100% of original shareholders.
2. Further, the provision which allows exemption of capital gains from sale of residential property on investment of net consideration in equity shares of eligible start-up shall be extended by 2 years. The benefit will be available for sale of residential property on or before 31st March, 2021.
3. The condition of minimum holding of 50% of share capital or voting rights in the start-up is proposed to be relaxed to 25%. The condition restricting transfer of new asset being computer or computer software is also proposed to be relaxed from the current 5 years to 3 years.
4. The FM stated that start-ups in India are taking firm roots and their continued growth needs to be encouraged.
5. To resolve the so-called ‘angel tax’ issue, the start-ups and their investors who file requisite declarations and provide information in their returns will not be subjected to any kind of scrutiny in respect of valuations of share premiums.
6. The issue of establishing identity of the investor and source of his funds will be resolved by putting in place a mechanism of e-verification.
7. With this, funds raised by start-ups will not require any kind of scrutiny from the Income Tax Department, the Finance Minister added.