At a time when the technology sector is witnessing a funding winter, investment firms and start-ups haven’t received any significant relief from the proposed change in the angel tax regime. Experts say that this might create a hindrance to the flow of foreign funding for Indian start-ups.
Various stakeholders have been suggesting excluding investments from foreign companies in start-ups from the angel tax regime. However, as per the list of amendments to the Finance Bill, passed in the Lok Sabha on March 24, there is no change in the original proposal to angel tax. The proposed changes will come into effect for the assessment year 2024-25 or the financial year 2023-2024.
“With the passing of the Finance Bill, 2023 – the applicability of angel tax on foreign investors has been cemented. The only two classes of investors whose investments are exempt from angel tax are SEBI-registered CAT I and II AIFs as well as IFSCA-regi
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