D👑Queen: So we have lots of questions about small and medium business, and of course startups. Let's talk about the Budget 2016 with respect to start-ups and micros/small/medium enterprises (MSME's)
⚖Advocate VV: First and foremost, in the "Startup India" action plan, the FM 📢 a 100% deduction of profits for 3 out of 5 years for start-ups from April 2016 to March 2019, with certain riders❗ I note that this similar to the tax benefits given to software companies and export oriented units etc in the past - all of which were well-directed, but ended up with lots of implementation issues and litigation😞. Hope this start-up scheme is implemented well Mr. FM❗
Secondly, the shortening of the holding period from 3️⃣ to 2️⃣ years to get the benefits of Long-term Capital Gains (LTCG) regime in case of unlisted companies (including startups) is a welcome move👏.
Thirdly, the registration of a company should take no longer than a day😲 under the Government's 1⃣-day Incorporation Policy📝❗ This is too good to believe😃, but let us hope for the best🙏
One of the more important aspects, in my view, was the Government's definition of a "start-up" which can avail the benefits of the "Start-up Action Plan" as "a company which would have equity funding of at least 20% by incubation, angel or private equity fund, an accelerator or angel network registered with SEBI endorsing the innovative nature of the business"❗ Well, we will see how this pans out😃
⬆ ✅ Overall, Budget 2016 was very positive👍 for start-ups as was expected with the PM's huge push for "Start-up India" .