The much-awaited Union Budget 2023-2024 was announced on February 1 by Finance Minister Nirmala Sitharaman
While start-ups hailed the extension of tax holiday & loss carry forward period, they expected better ESOP framework and early-stage funding schemes. Here’s a look at the top announcements Finance Minister Nirmala Sitharaman made
FM Sitharaman announced that a new ‘Agriculture Accelerator Fund’ would be set up to encourage agri start-ups founded by young entrepreneurs in rural areas
“The fund will aim at bringing innovative and affordable solutions for challenges faced by farmers. It will also bring in modern technologies to transform agricultural practices, increase productivity and profitability,” said Nirmala Sitharaman in her Budget speech
The start-ups’ taxable income has been extended from 7 years after the company's incorporation to 10 years in Union Budget 2023-2024
Start-up founders hailed the budget. Vidit Aatrey, Co-founder and CEO of Meesho tweeted, “#UnionBudget2023 is a significant step by the govt to put our MSMEs in the fast lane.”
Some start-up founders expressed disappointment as they expected some announcements around employee stock ownership plans
Anil Joshi of Unicorn India Ventures said the government will certainly need to revisit the policy framework around ESOPs as it is leading to a tax burden on employees in absence of liquidity events or for forgetting the reward if they are not in position to pay the tax liability
All eyes are now on how the Budget 2023 announcements impact start-ups. In the Economic Survey 2023, Ministry of Finance noted that start-ups inspire the youth to be ‘job creators’ rather than ‘job seekers’