Government should increase the tax rebate period from three years to at least five years

Startup India has set high expectations from the government within the startup community. The announcements made were really worth the appreciation, however there are things needed to be addressed to help entrepreneurial ventures grow and become successful. The success of the Start-ups will also ease out the burden of employment and skill the workforce in new technologies as the most of the startups are technology based with logistic solutions being their backbone.

The government should increase the tax rebate period from three years to at least five years as hardly any startup reaches breakeven point in three years of inception to actually pay tax. This will actually send out a strong message to the stakeholders on the effort and commitment of the central ministry has put in to make Startup India a success. This model has been successfully employed by Uttarakhand government for promoting manufacturing units in the region and it has been a huge success in attracting many big renowned names to the state for setting up their manufacturing units.

The digital connectivity has to improve if startups really need to flourish as the current infrastructure and services are very much limited to Tier 1 cities and hence a roadmap has to be created to provide much better connectivity even at the grass root level so that Startups can build more markets and are not restricted to major metro’s, this also has to be looked from logistics point of view as taxes will play a major role in delivery of product if not services in various geographies.

Startups to be charged less corporate tax, say 20% against the normal 30%, as they are addressing some real issues faced by the country. This would allow more cash in hand to be reinvested in their businesses as it will help them to obtain scalability which is a major concern for Startups due to which many of them get limited to particular cities or states.

Startups are also a medium for women of India to find liberation as many of the Entrepreneurs are women which is a heartening sight as government can do a bit more for women entrepreneurs or women who have co-founded a company and avail the benefits to the maximum.

Last but not the least, the Government should allocate funds for the starups and act as investors depending upon the scope of operations for which we are very grateful that a limit of 10cr. has been allocated for the same as it will help many startups to tread the un tested waters before going out nationally. The provision for exiting has been a great move by the government as it will boost morale of the new startups to actually take the entrepreneurship plunge.

Disclaimer: The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of the publication