CALL FOR EASE OF INVESTING

Startups and investors are seeking a slew of reforms on the current taxation norms including parity for capital gains tax treatment between unlisted and listed securities By Resham Suhail

Global economic uncertainties and the fear of some western economies going into recession have severely impacted the growth ambitions of several foreign fund-backed Indian startups by curtailing their ability to go public. As a result, the startup and the investor community is looking for succour from the upcoming budget via tweaks in the taxation and other norms.

Alternate Investment Space 

Digressing from the traditional investment routes, many HNIs or ultra HNIs (ultra high net worth individuals) are now stepping into the startup world. Witnessing the upsurge in disposable incomes, the Securities and Exchange Board of India (SEBI) is in the early stages of increasing the minimum ticket size for any limited partner (LP) in Alternate Investment Funds (AIFs) from the existing threshold of Rs 1 crore to Rs 5 crore.

Before this development, private equity and venture capital funds approached the stock exchange regulatory body to seek relaxations and ease in the norms in alternate investment funds. Ankit Kedia, Capital A while commenting on the same said, “The government is trying to balance the private and the public listed companies. But if the ticket size can be gradually increased, it would create less pressure on investors.”

Regulatory Norms for ESOPs