India proposes social security benefits for gig workers in annual budget – TechCrunch

India’s Finance Minister Nirmala Sitharaman proposed a handful of benefits for the startup ecosystem and accelerating the growth of digital services in the annual budget on Monday as the South Asian nation attempted to revive the economy amid a coronovirus epidemic.

Sitharaman said that the country has taken 1,500 crore Indian rupees ($ 205.3 million) to adopt digital payments. Paytm, Google Pay and PhonePe are locked in an intense battle to pay people digitally in India, but firms have Struggled to find a viable business model With their basic paid service.

Many firms were hoping that the government would allow them to charge fees for merchant transactions. No announcement was made on this front today.

Sitharaman said that the budget also proposed to launch a website to give social security benefits to gig workers and other platform workers and help these workers find employment. These workers will be protected by the minimum wage, she said. In addition, she said that women would be allowed to work in all categories with adequate protection.

In the budget, Sitharaman proposed some tax relief for startup employees when they sold their bets.

“During their early years, startups typically use the Employee Stock Option Scheme (ESOP) to attract and retain highly talented employees. The ESOP is an important component of compensation for these employees. Currently, ESOPs are taxable as perquisites at the time of exercise. This causes cash-flow problems for employees who do not sell shares immediately and continue for the long term. To promote the start-up ecosystem, I propose to reduce the tax on employees by postponing tax payments for five years or until they leave the company or when they sell their shares, whichever is sooner. he said.

The South Asian nation also broadened the definition of small businesses, raising the threshold for capitalization to 2 crore Indian rupees (about $ 275,000), from the current limit of 50 million Indian rupees ($ 68,750). This will allow many more businesses to come under the umbrella of small business and avail relevant benefits such as certain tax concessions.

“Also, considering the fact that in the early years, a startup may not have enough profit to take advantage of this deduction, I would like to extend the period of eligibility for the deduction claim from the current 7 years to 10 years. I propose, ”he said.

Incentives were also proposed to include one-man companies in the budget, which Sitharaman said would allow companies to “grow without restriction on paid capital and turnover, conversion to any other type of company at any time Will help reduce the residency limit. ” The Indian citizen will set up a one-man company from 182 days to 120 days, and will also allow NRIs to join one-man companies in India. “

In recent weeks, industry officials said they were also hopeful that India would Address digital service tax The country started accusing foreign companies last year. This was ignored in the new budget.

This is a developing story. Check back later for more information.