Budget 2020 – Impact on Startups and MSME’s

Startups and MSMEs

Budget 2020 has announced several measures which would impact the Startups and MSMEs:-

1) The Govt shall launch a Digital Platform for the protection of Intellectual Property Rights which shall facilitate seamless applications.

2) The Govt has also announced that the more ECB and FDI shall be allowed and invited in the Education Sector.

3) A subordinate debt scheme shall be introduced for MSME which would be counted as quasi-equity.

4) To be eligible for registering as a Startup the earlier criteria of turnover of Rs.25 Crore has been increased to Rs.100 Crore.

5) The tax exemption benefit that was given to the Startups for a period of 3 years in a block of 7 years has been increased to 10 years which means that a Startup can now avail tax benefits for a period of 3 years out of a block of 10 years.

6) Tax Audit for MSME shall be required in case the turnover exceeds Rs.5 Crore which was earlier Rs.1 Crore. However, this benefit can only be availed by those MSME whose total cash transaction does not exceed 5% of the total transactions.

7) Rs.8000 Crore allocated for National Mission for Quantum Technology over a period of 5 years.

8) A new Export Credit Scheme shall be introduced called Nirvik.

9) Schemes shall be announced to encourage Mobile Manufacturing, Medical Device Manufacturing.

10) National Logistics Policy shall be launched to make MSME more competitive.




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