Count Down to Union Budget 2017. Digital India: Need for lesser regulation, better implementation

While the Centre has been making big bang announcements towards boosting its Digital India campaign over the last two years, start-up and investors community want the Finance Minister to not announce any new schemes but find ways to implement the existing ones without bureaucratic hurdles.

This was the crux of the message emerging out of a panel discussion organised by BusinessLine as part of the run-up to the Budget 2017-18. The participants said the Centre needs to have lesser regulations and abolish unnecessary levies imposed on start-ups.

Manoj Gupta, Founder of Crafstvilla, said that starting up in India still remains a Herculean challenge compared to developed economies such as the US or Singapore. “The problem is not to start a business but the compliances and regulations one has to go through. There are so much paperwork required. What we need is an ease of start, ease of compliance and ease of exits,” he said adding start-ups should be treated differently and the archaic laws need to be amended.

Naveen Surya, founder of digital payments company ItzCash, said that the Government needs to announce enough incentives for both consumers and merchants to be able to make digital payments and for that the Government has to digitise a lot of its own transactions.

Mahesh Murthy, a tech investor and Founder of SeedFund, was of the view that the Government needs to be more pro-active and should not work towards making headlines in the media.

“Start-ups are the new job creators and it's time to give these people enough support,” Murthy said adding that one most important step towards this can be creating lot of engines of growth like Nasdaq in the US or AIM in the UK.

“Make it easy for the start-ups to list and allow accredited investors to invest in them. Tax holidays on profits for three years is not the solution as no start-up makes money in the initial years,” Murthy said adding that there is need for growth exchange like Nasdaq.

Serial angel and PE investor Sanjay Mehta said the Government should have longer tax holidays for a period of 10-15 years for start-ups just like what TCS and Infosys were given to boost the IT sector. “There is an immediate need to abolish Section 56 (2b vii) of the Income Tax laws even for those companies incorporated before April 2016 as it is detrimental to investors providing funding to new entrepreneurs,” Mehta said.

Mehta also said that the Government should ensure that capital in easily accessible to entrepreneurs.