PM Modi tries to allay tax fears of start-ups

NEW DELHI: Days after seeking to address concerns related to ‘angel tax’, Prime Minister Narendra Modi on Friday said policy-makers should look at start-ups and the new economy with a fresh eye and advised greater sensitivity.

“This issue is related to a segment of the new economy and it often happens that these issues can’t be addressed through the old lens. We need to be sensitive to this fact. When the issue was raised, the other ministries concerned immediately discussed this issue. A healthy dialogue has happened between the community and the government, and I am told that a further order has been passed to give relief to start-ups,” Modi told a news website.

Start-ups were complaining about a rush of tax notices seeking 30% tax on angel funding at a valuation higher than the market value of shares. The notices came two years after Modi had announced tax benefits, prompting a tweaking of rules by the department of industrial policy and promotion and the finance ministry.

“We are an ancient civilisation with a young population. Short-term fixes will not work. We need measures that will give us a long-lasting change,” he said.