Startups are planning to ask the government to resolve a new set of issues in the upcoming year, including faster processing of Tax Deducted at Source and Goods and Services Tax refunds and taxing of employee stock ownership plans (Esops) only at the time of sale.
This comes after startups successfully negotiated on the contentious angel tax issue and dual voting rights structure earlier this year.
On GST, startups claim they do not receive refunds on time, locking up working capital. They have also reported issues in offsetting input tax credit charged by suppliers against the same that they collect while selling products.
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Further, several startups have said that they are at a disadvantage while procuring services from abroad, on which 18% GST is levied through the reverse charge mechanism. They are unable to avail of input tax credit on this, they claimed.Startups and Micro, Small and Medium Enterprises now need to register in every state they stock products or invoices from, increasing compliance costs. This is another GST related issue that they want the government to address.
Source: ET Tech
