Budget 2024: Tax reforms and industry empowerment in spotlight for startups

As Finance Minister Nirmala Sitharaman prepares to unveil the interim Budget for the fiscal year 2024-25, startup CFOs are articulating their expectations, pushing for transformative measures that could shape the future of India's startup landscape.

From advocating tax reforms to highlighting sector-specific enhancements, their collective vision reflects a unified call for measures that empower and streamline the startup sector. Notably, there is a shared emphasis on the need for a government-controlled private industry body to facilitate growth and efficiency within the sector.

Here's what startup CFOs expect:

Gautam Bansal, CFO of Healthtech Startup Fitelo, anticipates measures that empower mature startups, urging an increase in the DPIIT Registered Start-up threshold and relief from compliance burdens.His advocacy extends to expanded government financing, democratization of technology, and the establishment of a government-controlled private industry body.

Additionally, in the Healthtech sector, Bansal emphasizes the importance of a National Health Regulatory body to prevent mis-selling and promote ethical practices, fostering growth for service-oriented startups like Fitelo.

Tanmay Kumar, CFO of an e-commerce unicorn Shiprocket, expresses optimism for the upcoming budget and emphasizes key priorities for financial growth and sustainability.

Kumar's expectations encompass specialized funding for technology-first startups, strategic investments in growth sectors, and enhanced Research and Development (R&D) tax incentives. He anticipates pivotal policy changes, such as Startup India benefits, public procurement opportunities, public-private partnerships, and regulatory ease, all contributing to a thriving startup ecosystem and India's long-term economic growth.

Mayank Gupta, CFO of CarDekho Group, envisions the 2024 budget enhancing tourism mobility infrastructure and addressing GST disparities in self-drive and chauffeur-driven cars. His recommendations include a 30 per cent personal tax rate cap, long-term capital gains benefits for ESOPs, and the introduction of a National Compliance Portal for startups.

Gupta also underscores the potential impact of incentivizing Environmental, Social, and Governance (ESG) initiatives, proposing measures to uplift the used car market, and advocating for a Service Linked Incentive for key sectors.

Akshay Sarma, CFO of consumer finance startup axio, focuses on tax reforms for Employee Stock Ownership Plans (ESOPs) to ease financial burdens and stimulate startup growth.

He calls for a revisiting of the GST benefit structure for Non-Banking Financial Companies (NBFCs), proposing a full 100 per cent input credit allowance to foster their growth.

Sarma's policy recommendations also include initiatives to increase credit access for low-income individuals and promote modern NBFCs, aligning with the Reserve Bank of India's push for alternative funding channels.

In anticipation of the budget's unveiling, these CFO insights collectively illuminate a pathway towards a robust and inclusive economic future, showcasing the unified aspirations of India's dynamic startup landscape.