Finance Minister Nirmala Sitharaman proposes measures to carry forward and set off losses for startups and increase in period of exemption of capital gains from the sale of residential house for investment in startups up to March 2021.
To resolve the issue of Angel Tax the startups and investors who file requisite declarations will not be subjected to any kind of scrutiny in respect of valuation of share premium. A mechanism of e-verification will be put in place and with this, the funds raised by startups will not require any tax scrutiny.
Currently, 25 percent corporate tax rate is applicable to companies with an annual turnover of up to Rs 250 crore. This has been extended to companies with turnover of up to Rs 400 crore. Only 0.7 percent companies will remain outside of this 25 percent rate.
Sitharaman also proposed to make PAN and Aadhaar interchangeable to file income tax returns.