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How Union budget 2023-2024 impact to startups

How Union budget 2023-2024 impact to startups 1

In this emerging world, India is also coming a leader in innovation and entrepreneurship. India is considered the third largest startup ecosystem in the whole world. Some of the vital roles and responsibilities of any startup are to make the development of the Indian economy. After this, India is placed as the fifth strongest country in the globe. Factors that have been acknowledged by the finance minister Nirmala Sitharaman in the Budget 2023-2024 are-

5G

Telecom players like Airtel and Reliance Jio which is serving 5G services. The government is looking to step ahead in the league of the fifth-generation mobile network for different sectors. In order to get this achievement, the government is planning to set up 100 labs to develop apps based on 5G. These apps are going to cover use cases that include smart classrooms, precision farming, healthcare, and intelligent transportation systems.

Artificial intelligence

The Make in India program is pushing India towards extending the role of artificial intelligence. The government agencies are also planning to set up three centres of excellence for AI under a campaign which is named ‘Make AI in India and Make AI work for India’.

According to finance minister Nirmala Sitharaman, the top industry players in India will partner together to conduct interdisciplinary research, and develop cutting-edge applications and scalable problem solutions in the areas of agriculture, health, and sustainable cities.

National Data Governance Policy

Soon, the government will come up with a national data governance policy under which it will share the data with researchers and academia.

DigiLocker boost

The ever-extending scope of DigiLocker is revolving. DigiLocker is seen as a citizen’s digital document wallet that generally assists innovation in the fintech industry. In the near future, Entity DigiLocker will allow MSMEs, large businesses, and charitable trusts to store and share documents with authorities and regulators, banks, and other business entities.

Finance Minister of India, Nirmala Sitharaman in her Budget 2023-24 has facilitated the relief to start-ups in carrying forward and setting off of losses.

As per Section 79 of the Income Tax Act, it is restricted to carrying forward and setting off losses in cases of companies, other than the companies in which the public is interested substantially. It also restricts the setting off of carried forward losses if there is a change in shareholding. The carried forward loss is set off only if at least 51% of shareholding remains the same with the company on the last date of the previous year to which the loss belongs.

Apart from this, there is also some relaxation that has been granted in case of an eligible start-up as referred to in section 80-IAC. The condition of continuity of at least 51% shareholding is not applicable to the eligible start-up. The loss was incurred on a continuous basis to hold those shares on the last day of the previous year in which the loss is set off. There is an additional condition that the loss is allowed to be set off, under this relaxation.

To align the period of seven years with the period of ten years that is contained in section 80-IAC(2) of the Income Tax Act, the time period for loss of eligible start-ups to be considered for relaxation was proposed to be increased from seven years to ten years from the date of incorporation.

Also, as per the government, it is proposed to amend the proviso to sub-section (1) of section 79 to carry forward the loss of eligible start-ups that shall be considered for set off under the proviso. In case the loss has been incurred during the period of ten years beginning from the year in which the company was incorporated.

The amendment will come into effect from 1st April 2023 and will be applied to the assessment year 2023-2024 and subsequent assessment years.

Written by Srikanth

Passionate Tech Blogger on Emerging Technologies, which brings revolutionary changes to the People life.., Interested to explore latest Gadgets, Saas Programs

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