As per the suggestions made by NASSCOM, startups be exempted from direct and indirect taxes including MAT , a move that would reduce compliance burden and reduce cash outflows. Further there is an urgent need to remove angel tax that serves to tax the capital receipts, when the availability of financing from recognized sources such as Banks and Venture Capital Funds is unavailable and angel funds is the only available source. Similarly, NASSOCM strongly recommended that companies may be allowed to carry forward losses even if there is change in ownership structure, if it for capital infusion in the entity.
