Sunday, 4 September 2016

A Booster Shot ?


Business Line ( 05 Sept 2016 ) carries a news report titled :

Start ups may get a Booster Shot of fresh incentives "


It says :

" An inter-ministerial committee headed by DIPP Secretary , Ramesh Abhishek , and comprising senior officials from the NITI Aayog and from Ministries and Departments such as Finance, Labour , Environment , HRD and MSME , will meet within a fortnight to discuss a possible new stimulus for Start ups


The official said ,

We will to push for some more tax incentives in addition to the three year tax holiday, lower compliance requirements especially in labour and taxation and a relaxation in listing norms


The line Ministries will take forward what the inter-ministerial committee feels is feasible so that the new rules can be worked out . We are examining the tax policies of countries such as Argentina , Australia , Chile , Finland and Israel "



Considering that nearly ONE YEAR after the launch of the Start Up initiative , so far only 3 Start Ups have managed to qualify for the tax holiday , this is very good news


But trying to compare what other countries have done to boost their Start Ups , has only , a very limited learning !


We have,

#    A history of 60 years of total neglect of the Start Ups , under a license / permit raj


#    12 million young people joining our work force each year ( with only 10 % finding jobs )


#    3.5 million graduating from colleges , each year ( of which , only 20% are found " Employable " by industry )



I once more request the Committee - and the concerned Ministries - to find a " Productive Vent " for the enormous / volatile energy , trapped inside this " Volcano of Unemployed Youth  "


My own suggestions are contained in my following blogs ( sent earlier as email concerned Policy Makers ) :

--------------------------------------------------------------------------------------------------------------------------------

Saturday, 16 January 2016

TEN  MILLION  START- UPS  IN  ONE  YEAR  ?


Thank you , Narendrabhai , for the Start Up Action Plan announced last evening


I am glad that some of my suggestions ( sent to Ministers / Secretaries ) over the past 2 years , have been incorporated in the ACTION PLAN , in respect of :


*    Self Certification

*    Simplified Registration thru Mobile App

*    Tax Exemption for Capital Gains

*    Entrepreneurship Program for 10 lakh students 

*    No Corporate Income Tax for 3 years


   
 You will find my detailed suggestions covering these points in following blogs at :
 www.hemenparekh.in :







            (  http://myblogepage.blogspot.in/2015/09/from-job-seekers-to-job-creators.html ) 




           (  http://myblogepage.blogspot.in/2015/09/back-factory-of-world.html  ) 




           (   http://myblogepage.blogspot.in/2015/12/blue-print-for-start-up-nation.html  ) 





           (   http://myblogepage.blogspot.in/2015/12/creating-jobs-vs-creating-self-employed.html  ) 





          (   http://myblogepage.blogspot.in/2015/12/get-out-of-way.html  ) 





          (   http://myblogepage.blogspot.in/2015/10/ten-million-entrepreneurs.html  ) 





          (   http://myblogepage.blogspot.in/2015/10/start-up-eco-systems-usa-vs-india.html  )






          (   http://myblogepage.blogspot.in/2015/09/treading-beaten-path.html  ) 





         (   http://myblogepage.blogspot.in/2015/09/second-industrial-revolution.html  )






         (   http://myblogepage.blogspot.in/2015/09/from-single-window-to-single-day.html  ) 





         (   http://myblogepage.blogspot.in/2015/09/myth-of-job-creation.html  ) 





         (   http://myblogepage.blogspot.in/2015/09/killing-many-birds-with-one-stone.html  ) 





         (   http://myblogepage.blogspot.in/2015/07/if-mohamed-cannot-go-to-mountain.html  ) 





         (   http://myblogepage.blogspot.in/2015/12/ditch-historical-baggage.html  ) 





         (   http://myblogepage.blogspot.in/2015/02/create-self-employment.html  ) 



Very likely , your initiative may see the birth of ten thousand new start-ups in 2016-17, which , together , might generate one lakh jobs


In itself, this will bring a new dynamism to India's Economy 


But that will still fall far short of 12 Million ( 120 lakh ) youth joining the work-force each year

Can all of these youth become Start Ups ?


It is entirely possible


All you need to do is to implement my following suggestion, described in ,

"  A New Economic Order / Start Up Act - 2015 " /  12 Sept 2015  " :



SUGGESTION

    *  Although all Start Ups will need to file annual Income Tax returns ( with full disclosure of income / expenses / profits / sources of funds etc ) , it will not be required to pay any Corporate Income Tax for the first 10 years of its existence


     *  A Start Up will be free to raise  funds from any source ( Individuals / Companies / PE funds / VCs / Angel Investors / Religious Trusts etc )


     *  100 % FDI will be permitted in Start Ups


     *  A Start Up can receive loans or equity and be able to accept fixed deposits . It can also give loans to individuals or other Start Ups or invest in other Start Ups by way of equity


    *  There will be no restrictions on what interest ( on loans / FDs ) that a Start Up may pay nor any restrictions on dividends it may declare


        The dividends declared by Start Ups will not attract any Income Tax


    *  As far as the persons / companies etc providing funds to Start Ups ( by way of loans or equity ) is concerned , no questions will be asked re their source of funds




   WHAT  WILL   HAPPEN , IF  IMPLEMENTED  ?


   *  Billions of rupees worth Black Money will flow into these Start Ups - money which is currently lying unutilized or locked up in unproductive assets

       
    *  Within 3 months , thousands of Venture Capital Funds will be born , exclusively for funding of Start Ups ( You know who will set up these VCs ! )


    *  With NO Income Tax to be paid , Start Ups will conduct all transactions through cheques ( receipts / payments )


    *  GST  collections will go up


    *  Domestic Savings Rate will go up


    *  Since millions of ( Black Money holding ) individuals / businesses will come forward to fund these Start Ups , lending pressure on banks will go down


    *  Who knows , Start Ups may get into the business of Assets Reconstruction and relieve banks of NPAs !


    *  With locally / domestically stashed Black Money flowing into the economy , our dependence on FDI will go down


    *  Corruption will decline drastically



Dear Shri Narendrabhai :


It is still not late to incorporate my suggestion in forthcoming Union Budget on 29 Feb 2016

This is your opportunity to ,

*   Dream BIG

*   Enable millions to dream big

*   Unleash the Entrepreneurial Genome of India's Youth

*   Make 21st Century , an Indian Century 

*   notwithstanding the opposition in Rajya Sabha


--------------------------------------------------------------------------------------------------------------------------------

05  Sept  2016

www.hemenparekh.in / blogs


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