New Delhi, Ahead of the Union Budget, the Department for Promotion of Industry and Internal Trade (DPIIT) has recommended scrapping of angel tax on startups, but the Finance Ministry will take an integrated view, a senior official said. government.
In September last year, the Income Tax Department notified new angel tax rules comprising a mechanism to assess shares issued by unlisted startups to investors.
While previously the angel tax (a tax levied on capital received from the sale of a startup's shares above fair market value) applied only to local investors, the Budget for fiscal year 2023-24 (April from 2023 to March 2024) expanded its scope to include foreign investments.
Replying to a question on the industry's demand to remove angel tax here on Thursday, DPIIT secretary Rajesh Kumar Singh said, "Based on the consultation with the startup ecosystem we have here, we have also recommended it in "I recommended it this time too, but in the end the Ministry of Finance will take an integrated view."
According to the Budget, excess premium will be considered "source income" and will be taxed at a rate of up to more than 30 per cent. However, startups registered by the DPIIT are exempt from the new rules.
To a question about Tesla, Singh said that "the last we heard from them" was the week the general election results were announced.
"Let's see. But the process of finalizing the guidelines (for electric vehicles) is under the Ministry of Heavy Industries. They have more than one investigation, as I understand..." he said.
On June 7, days after the general election results were declared, American tech billionaire Elon Musk, in a post on Minister Narendra Modi for his historic electoral victory.
The congratulatory message came two months after the CEO of electric car maker Tesla and microblogging platform X postponed his proposed visit to India in April due to "very heavy obligations to Tesla."
Musk, who was expected to be in India on April 21 and 22 and was scheduled to meet with Prime Minister Modi, later wrote on X that he hopes to come to India later this year.
In June last year, Musk met Modi during the latter's visit to the United States and stated that he planned to visit India in 2024, while he expressed confidence that Tesla would soon enter the Indian market.
In September last year, the Income Tax Department notified new angel tax rules comprising a mechanism to assess shares issued by unlisted startups to investors.
While previously the angel tax (a tax levied on capital received from the sale of a startup's shares above fair market value) applied only to local investors, the Budget for fiscal year 2023-24 (April from 2023 to March 2024) expanded its scope to include foreign investments.
Replying to a question on the industry's demand to remove angel tax here on Thursday, DPIIT secretary Rajesh Kumar Singh said, "Based on the consultation with the startup ecosystem we have here, we have also recommended it in "I recommended it this time too, but in the end the Ministry of Finance will take an integrated view."
According to the Budget, excess premium will be considered "source income" and will be taxed at a rate of up to more than 30 per cent. However, startups registered by the DPIIT are exempt from the new rules.
To a question about Tesla, Singh said that "the last we heard from them" was the week the general election results were announced.
"Let's see. But the process of finalizing the guidelines (for electric vehicles) is under the Ministry of Heavy Industries. They have more than one investigation, as I understand..." he said.
On June 7, days after the general election results were declared, American tech billionaire Elon Musk, in a post on Minister Narendra Modi for his historic electoral victory.
The congratulatory message came two months after the CEO of electric car maker Tesla and microblogging platform X postponed his proposed visit to India in April due to "very heavy obligations to Tesla."
Musk, who was expected to be in India on April 21 and 22 and was scheduled to meet with Prime Minister Modi, later wrote on X that he hopes to come to India later this year.
In June last year, Musk met Modi during the latter's visit to the United States and stated that he planned to visit India in 2024, while he expressed confidence that Tesla would soon enter the Indian market.
