With no angel tax, startups and investors hope for better funding scenario

While the abolition of the angel tax is a big win for startups and their investors, the ecosystem is not out of the woods yet

The recent Budget announcement to abolish angel tax, which affected the Indian startup ecosystem, is being seen as a sentiment booster for investors, promising to incentivise high net-worth individuals, family offices, and foreign venture capitalists to loosen their purse strings. 

Still, investors are cautious about the decision's immediate impact on funding volumes, anticipating any increase in funding will likely be gradual.

“No foreign investor wants to invest in a country with a risk that his/her investment can be arbitrarily treated as taxable income (of startups). This move (the abolishing of angel tax) will streamline the investment process