Being a developing country, India has more than 50% of its population under the age of 25 years and more than 65% of its population under the age of 35 years which primarily makes us a young country. We have a lot of untapped talent who are driven by their passion and wish to create solutions for very real problems faced by the country. The Govenment of India has introduced many different schemes. programmes, and grants that can help as individual not only to setup his start-up but also to succeed in it.

The Union Budget 2020 announced recently had several upsides for the businesses of start-ups and MSMEs. In order to support the growth of start-ups, the Finance Minister proposed that employees who exercise ESOPs issued by start-ups can defer the payment of tax thereon by a period of five years or till the employee leaves the organisation or at the time of sale of ESOPs, whichever is earliest. Another major step to boost the start-up ecosystem was that an eligible start-up with turnover of up to INR 100 crore can claim deduction of 100% of its profits for three consecutive assessment years out of ten years. Earlier, this 100% deduction of profits was only available to start-ups with turnover of up to INR 25 crore and eligible for seven assessment years.

Compliance Burden

The Government also sought to reduce the compliance burden on small retailers, traders, and shopkeepers, by raising the turnover threshold for audit from existing INR 1 crore to INR 5 crore for businesses that carry out less than 5% of their transactions in cash. The Government shall provide support in areas of technology upgradation, business strategy, R&D to mid-size companies in pharmaceuticals, auto components, etc. and has launched a scheme of INR 1,000 crore to further this goal.