Where angel investors fear to tread: The law that\'s taxing Indian start-ups

Where angel investors fear to tread: The law that's taxing Indian start-ups

Despite relaxations and guidelines announced by DIPP and CBDT over the last couple of years, valuation mismatch continues to divide tax authorities, investors and the start-up community

Sudipto Dey 

Angel investors and start-ups have been crying foul, time and again, over the issue of angel tax. Over the years, the government’s stance on this issue has undergone several changes since its introduction to the statute books following the 2012 Budget speech by the then finance minister, Pranab Mukherjee.

Sections 56(2)(viib) and 68 of the Income Tax Act 1961 — that form the crux of angel tax — were enacted into law as a means to plug the laundering of black money through unlisted entities. Despite relaxations and guidelines announced by the Department of ...

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First Published: Sun, December 23 2018. 22:33 IST