Create jobs to get subsidies: Govt to Startup India
- Under the Startup India Programme, companies can avail benefits like tax holidays and fast-track patent filing.
- At present, the main criterion for startups to qualify for the programme is innovation.
- However, the government will soon notify a new definition for startups that will be beyond innovation and there will be additional requirements.
Now, firms and companies interested in availing the benefits offered by the government under Startup India Programme will have to declare how many jobs the firm or company would be creating.
Under the Startup India Programme, companies can avail benefits like tax holidays and fast-track patent filing, and at present, the main criterion for startups to qualify for the programme is innovation. However, the government will soon notify a new definition for startups that will be beyond innovation; the Economic Times quoted a senior government official as saying.
The programme was launched in 2016 by the PM Modi and one of its aims was to create jobs for youths but back then it was not made a mandatory requisite for startups. But now, under the new definition startups will have to have a certain level of innovation in service or product, declare their job creation targets, and also meet financial standards to be qualified for the benefits under Startup India.
Apart from this, the government will conduct additional scrutiny while examining the applications before providing the tax benefits; the report quoted the official as said.
Under the programme, any company incorporated post-March 31, 2016, could get three-year tax holiday in its first seven years under this Startup India Programme. Department Of Industrial Policy & Promotion (DIPP) as of now has recognised 798 applications from startups but have not selected anyone for tax benefit.
However, DIPP has decided to relax its norms for startups by doing away with the need of certification from government-recognised incubator about the innovation capabilities of any startup to be eligible for the programme. The government department has also decided to increase the gestation period of biotechnology or a medical devices firm as startup from current 5 years to 8 to 10 years. According to a Nasscom report by 2020, the startup sector is expected to create 2.5 lakh jobs from 80,000 jobs at present.