Here’s what Startups Want From the Interim Budget ’19
The Interim Budget 2019 is knocking at the door, and startups are ready with their list of demands. Over the days the Government has strived to help startups, yet it seems a lot needs to be addressed.
But what is it that startups really want from the Interim Budget? Sub Editor Gairika Mitra spoke to a few entrepreneurs and most of them had interesting viewpoints. Here’s a lowdown!
Joy Sharma and Sudeep Gupta, founding partners, Impactify
The upcoming budget may introduce measures for stricter enforcement of the CSR laws to ensure that corporates carry out their responsibilities as prescribed in the Companies Act, 2013. While this is important, the government also needs to understand that corporates face genuine problems in complying with the CSR mandate. One of these problems is the inability to find credible NGOs to partner with.
There should be a strong focus on data-driven need assessment. Companies usually undertake projects in thematic areas they are passionate about. Common themes such as education, sanitation, and skill development, may, therefore, get more attention than others such as reducing inequality, and environmental sustainability. The government can play a major role by providing grassroot data more frequently, enabling NGOs and corporates to design outcome-driven projects that address real need gaps.
Finally, a strong focus is also required for monitoring implementation, over and above the current practice of tracking fund utilization.
Sudep Singh, Chief Evangelista and CEO, GoWork.
One major challenge that still remains is the angel tax. Many startups face the heat of clearing this outstanding amount from the funds, which keeps them from trying their hands at innovation at a consistent pace.
Also, in order to enrich the Indian market, the rate of corporate tax, which is currently at 33 percent, should be reduced significantly. Lower rates of corporate taxes are one of the major factors that attract businesses to overseas markets. (For example, in Singapore, it is charged at 17 percent, making it a profitable ecosystem for businesses to sustain).
Another consideration should be easing the FDI norms for raising funds from private equity players who can strengthen the inflow for our commercial real estate verticals like office spaces, malls, hospitals and hotels. This is quintessential for the consistent growth of India’s realty and construction sector."
Pawan Gupta, CEO, Betterhalf.ai
While raising funds in US, I found it relatively easy to issue convertible note based on future valuation of company to investors. This concept is not prominent in India.
Also, startups should be able to send up to $250,000 per year, without sophistication of documents needed. At present, the level of documentation and continuous scrutiny brings distractions to the startup progress. This should be done away with.
Vineet Chaturvedi, co-founder, Edureka,
‘Skilling' and 'continuous learning' have become sufficiently important requirements in today's competitive professional landscape so much so that even the Indian Govt. has taken note of it and launched skill development initiatives.
Continuous learning is a necessity and not just an option anymore and by treating it on par with necessary allowances such as HRA, LTA, DA & others, GOI would be doing India a great service. After all, India's biggest strength is its human resource. Such an allowance will also be beneficial to IT, ITes industries which are subject to frequent skill churn and the ed-tech industry which has been working towards addressing this skilling need on ground.
In a nutshell, here are the major takeaways:
- Angel Tax must be axed
- Initiatives should be taken to protect Indian IP against global corporations
- Focus on data driven assessment
- Tracking fund utlisation
- Rate of corporate tax should be reduced significantly
- Ease in documentation process
Well, at present there are more questions than answers regarding the outcome of the Budget. Come Friday, a lot of them would be clarified.