Indian government has asked S. Ramadorai, ex-CEO of TCS to advise the government on startup tax bill. S Ramadorai currently serves as an advisor to the Prime Minister of India in the National Council on Skill Development, Government of India. He holds a rank equivalent to an Indian Cabinet Minister.
Now that government has asked S. Ramadorai, do expect a talk before the bill is finalized. This is an important news and a ray of hope for entrepreneurs across the country (please spread the word).
More updates as as we get them. But we request you to help spread the word among startup community so that they can go ahead and talk to S. Ramadorai.
From our earlier coverage:
“Unfortunately, it is the equivalent of dropping an atom bomb on a city because one criminal needs to be killed. This clause will completely kill all angel investment in the country and, with that, spell the death knell of first generation entrepreneurship that had begun to mushroom over the last few years.
Various measures enunciated for SMEs will come to naught because of this one clause. This is because angel investment precedes venture capital investment. For VC’s to fund 10 companies we need 1000 entrepreneurs to be funded by angels. It is common knowledge that when you fund an entrepreneur who just has an idea and not much else, the definition of fair market value cannot possibly be determined by any valuer and certainly not by a tax authority but only resides in the minds of the entrepreneur and the investor. A tax officer could legitimately see the value as close to zero, whereas any angel investor who chooses to invest will do so because he / she sees great value and would buy shares at a huge premium because they would want the entrepreneur to hold a majority of the company.”
Startup Tax details details: Angel Investors Beware: Funding Startups Could be Classified as Income [Budget 2012]