NEWS
17/01/2016 7:50 AM IST | Updated 15/07/2016 8:25 AM IST

Modi Announces Tax Holiday And Rs 10,000 Crore Fund For Start-Ups

STRDEL via Getty Images
Indian Prime Minister Narendra Modi gestures as he speaks during an event to launch an initiative to bolster start-ups in New Delhi on January 16, 2016. Indian entrepreneurs will receive generous tax breaks and face dramatically reduced red tape when starting and closing a business, Prime Minister Narendra Modi said January 16, as he launched a pet initiative to bolster India's fast-growing startup scene. Speaking at a gathering of 2,000 entrepreneurs from India, Silicon Valley and elsewhere, Modi outlined a slew of measures under Start Up India including exempting startups from income tax for their first three years. AFP PHOTO / STR / AFP / STRDEL (Photo credit should read STRDEL/AFP/Getty Images)

NEW DELHI -- Indian Prime Minister Narendra Modi on Saturday unveiled a slew of incentives to boost start-up businesses, offering them a tax holiday and inspector raj-free regime for three years, capital gains tax exemption and Rs 10,000 crore corpus to fund them.

Prime Minister Narendra Modi addressing the gathering at the launch of Start-Up India at Vigyan Bhavan on January 16, 2016 in New Delhi, India.

He also announced a self-certification scheme in respect of nine labour and environment laws and said there will be no inspection during the first three years of launch of the venture.

Also, a liberalised patent regime is being brought to help start-up businesses register patents, for which the fee will be slashed by 80 per cent.

Also Read: Govt Will Announce Startups-Friendly Tax Regime In The Budget

Addressing the first conference of start-up entrepreneurs, Modi announced an action plan to boost such ventures which are seen as key to employment generation and wealth creation.

India, which has the third-largest number of start-ups globally, will also support the ventures by removing the criteria of experience and turnover for bagging government procurement contracts.

Modi said profits earned by start-ups will be exempt from payment of income tax during the first three years of business. To boost financing, a 20 per cent tax on capital gains made on investments by entrepreneurs after selling own assets as well as government-recognised venture capitalists will also be exempt.

He further said an unencumbered easy exit option will be provided under the bankruptcy Act so that start-ups can exit within 90 days.

Contact HuffPost India

Also see on HuffPost:

Photo gallery Startups That Began With Pretty Much Nothing: CNBC See Gallery