Govt. Takes Steps To Ease ‘Doing Business'

Expedites payments and GST refunds for MSMEs

The government on Friday announced several decisions to ease doing business in India, including scrapping the angel tax for registered start-ups, expediting GST refunds for the MSME sector, as well as setting a timebound window for the payment of delayed dues by public sector companies.

“In order to mitigate genuine difficulties of start-ups and their investors, it has been decided that the relevant provisions of Section 56 of the Income Tax Act, which is commonly called the angel tax, shall not be applicable to a start-up registered with the Department for Promotion of Industry and Internal Trade,” Finance Minister Nirmala Sitharaman said, addressing a press conference to announce the decisions.

The angel tax provision has been a pain point for start-ups who have repeatedly complained that the tax burden was slowing down the angel investments made in new companies. The government will also set up a dedicated cell under a member of the Central Board of Direct Taxes to address the problems of start-ups pertaining to income tax.