Hi Friends,

Even as I launch this today ( my 80th Birthday ), I realize that there is yet so much to say and do. There is just no time to look back, no time to wonder,"Will anyone read these pages?"

With regards,
Hemen Parekh
27 June 2013

Now as I approach my 90th birthday ( 27 June 2023 ) , I invite you to visit my Digital Avatar ( www.hemenparekh.ai ) – and continue chatting with me , even when I am no more here physically

Monday 1 February 2021

21-22 Budget Blues : One Person Company ( OPC )

 


Context :

FM’s one-person co vaccine leaves startups in two minds   [  TOI / 02 Feb  ]

Extract :

The proposal to incentivise setting up a One Person Company ( OPC ), might not led to any significant boost for startups, though it may help micro-entrepreneurs formalize their business at a very early stage


While allowing OPCs to grow without any restrictions on paid-up capital and turnover, allowing their conversion on any other type of company at any time, FM reduced the residency limit for an Indian citizen to set up an OPC to 120 days from 182 days and allowed NRIs to set up OPCs in India


“ The ability of OPCs to raise external capital, be it angel funding or any other, is severely limited. OPCs can’t even issue staff shares. This announcement is good for people who are running mom-and-pop shops, since they can now have a corporate structure and avail of lower tax rate “, said Siddharth Pai, founding partner at venture capital firm, 3one4Capital

[ siddarth@3one4capital.com  ]


Nithin Kamath, co-founder and CEO of Zerodha,

[ nithin.kamath@zerodha.com ]

 - echoed Pai, saying, “ I don’t think it will make any material impact on the Startup Eco-system like Bengaluru’s. May be it will help micro or small-sized entrepreneurs like someone setting up a bakery “


But Ankur Bansal, co-founder of BlackSoil,

[ ankurbansal@blacksoil.co.in ]

- a venture debt platform, said the biggest advantage of an OPC is that its identity is distinct from that of its owner

===================================================

Thank You, Smt Sitharamanji,

 

Without doubt, the relaxations announced by you will go some way to make it easy for entrepreneurs to become “ Self Employed “ . For that reason, this is a very welcome announcement


But when released, if the “ details “ were to incorporate suggestions contained in my following e-mail, then we will see 4 / 5 million OPCs registering within next 12 months !


With changes suggested by me, Shri Tomar would be able to convince 140 million FARMERS, to register themselves as One Person Companies ( OPCs ) and start entering into contracts with other FARMERS’COOPERATIVES / Companies / Food Corporation of India etc., under CONTRACT FARMING ACT  ! In any case , currently farmers are not liable to pay any Personal Income Tax !


Within 24 hours , farmers will withdraw their agitation demanding repeal of Farm Laws !


A NEW ECONOMIC ORDER ? aka " Start Up Act - 2015 "…….. 12 Sept 2015 


Extract :

 

#   Objectives of the Act

 

     Every year , to create 5 million Start Ups , each employing 2 persons , for a

     total of 10 million new jobs per year

 

     

 

 

#   Methodology

 

     *  Instead of Companies Act - 1956 , these Start Ups will be governed by

         the Start Up Act - 2015

 

     *  A Start Up can be launched by any Indian citizen under the age of 30 (

         covering roughly 65 % of our  population )

 

          

     *  A Start Up will need to register online on the web site of the Income Tax

         Department and obtain a unique " Start Up Number "

         

 

     *  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 inves

         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  ?

 

   *   Billions of rupees worth Black Money will flow into these Start Ups -

        money which is currently lying unutilized or locked up in unproductive

        assets

 

        

 

    *   If Jan Dhan Yojana could create 200 million bank accounts in 20

         months, Start Up Act - 2015 , will  create 200 million Start Ups in next

         10 months !

 

         

         All that led to this World record was, someone suggesting the

         unthinkable :

 

        " Let us enable poor people to open bank accounts with ZERO bank

           balance "

 

        " Start Up Act- 2015 ", will unleash a similar " Start Up Tsunami "  !

 

 

    *   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

 

 

 

#   Why  the  need  for  Start Up Act  ?

 

·          It is simple

 

            In the past 300 years , we have had different systems of Economic

            Development , viz:

 

            Communist  /  Socialist  /  Capitalist

 

·        There were periods when each worked well - depending upon the

         geography and the technological environment prevailing during those

         periods

 

·          Today, Internet and mobile apps are pushing the World towards an


           E - Commerce economy , which covers entire World seamlessly


 

·          Tomorrow, Internet of Things ( IoT ) , will tell us what we need to do

           and when ! Our lives will be dictated by devices !

 

              That will demand a brand NEW SYSTEM of economic development

              which transcends national boundaries

 

            

 

·          Old rules / regulations / laws will not help us find jobs for 12         million youths entering India's work force each year

 

·          An ocean-going " Ship " , cannot traverse galactic distances of Space

 

·          Following in the footsteps of Albert Einstein / Stephen Hawking , we

           need to

 

            " Bend the Space "

 

              And travel through the Worm-holes !

 

·          Using the hologram of the " Start Up Act - 2015 " , we must projec

           our economy into :

 

           Distributist Economy ",

 

-  which goes beyond the " Communist / Socialist / Capitalist " economies 

 

·          That is the ONLY WAY to create a ,

 

            "  New  Economic  Order  / The Start Up Economic Order "

===================================================

With regards,

Hemen Parekh  /  hcp@RecruitGuru.com  /  02 Feb 2021

 

 

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