There will be no income tax on startups' profits for three years... There will be no compromise on quality but the idea is to give the new enterprises opportunities—Prime Minister Narendra Modi
Prime Minister Narendra Modi launched a string of initiatives on Saturday to support the country's start-ups, including a fund of Rs 10,000 crore ($1.48 billion), an app-based registration for companies to be completed in a single day and a host of tax and compliance breaks.
Modi said start-ups would not face compliance inspections for three years, and would also benefit from cheaper and faster patent applications, as well as a three year income tax exemption.
"There will be no income tax on startups' profits for three years," PM Modi announced at the Vigyan Bhawan in New Delhi during the Startup India meet organised by the government.
The announcement comes months after Modi made a whirlwind tour of Silicon Valley, meeting the chief executives of Facebook, Google and Apple.
Stating that the success of entrepreneurs depends on their ability to take risk, Modi said, “The success of entrepreneurs depends on their ability to take risks. With a risk-taking capacity and the purpose of adventure, we can give something good to the world,” he said, taking the example of US transportation network company Uber, which he said has become Kuber (the god of wealth) due to its entrepreneurship.”
The other decisions include: A fast track mechanism for filing patents for startups, 80 per cent rebate for filing patents by startups and relaxed norms for when government, which is one of the largest buyer of goods and services in the country, procures from startups.
"There will be no compromise on quality but the idea is to give the new enterprises opportunities," he said.
Lauding entrepreneurs, Mr Modi said, "Those who begin startups, money is a byproduct for them. They want to make difference to people's lives...If it gives jobs to five people, a startup is taking my country forward."