Indian startup community including entrepreneurs, venture investors and industry associations have knocked the doors of both the prime minister and the finance minister seeking urgent intervention to tide over coronavirus crisis. The letter dated 30 March as seen by BusinessToday.In seeks fiscal support as well as easing of several compliance burden on startups. The letter has been co-signed by leading organisations such as CII startup council, iSPRIT, IVCA, Indian Angel Network, venture investors such as Mohandas Pai of Aarin capital, Accel, Blume, Chiratae, 3one4capital and founders of start-ups like Rahul Garg (Moglix) , Sriharsha Majety (Swiggy) Aloke Bajpai(ixigo), Amod Malviya (Udaan) among others.
The letter to the Prime Minister reads: "Covid crisis threatens to destroy all of the progress and future potential of our startup ecosystem in a few short months. Unfortunately, our startup companies across the nation are inherently young, less resilient, and most vulnerable. Many of them face likely devastation during this extraordinary economic downturn".
Further in the letter to the Finance Minister startups have sought extension of turnover limit to Rs 500 crore for startups to qualify for Covid-19 stimulus, in addition to several other fiscal concessions. Startups have sought the government to provide 50 per cent of the salary bills and contract wage bills for a period of April to September in order to ensure that there are no job losses post COVID-19.
Also, startups are seeking interest free loans against Income Tax and GST refunds, payable upon the receipt of the refund from CBDT or CBIC.They have also sought deferral of interest payment by one year and quick approval and disbursal of soft-loans to mitigate the effects of COVID crisis on businesses and job losses.
The startups in the letter have also asked for relaxation of regulatory compliance expediting payments of income tax and GST refunds by 30 April, 2020 to start ups for claims below Rs 10 crore. In addition measures like allowing a moratorium on the deposits of TDS and GST until 30 June, suspension on issues of notices by tax authorities for a period of six months ending 30 September.
With many countries like the US, UK and Canada announcing massive economic bailout plans to protect their businesses, economies and job losses, Indian startups now fear that unless speedy relief measures are announced by the government, many of them may not survive this economic downturn in the face of global recession.