Tuesday, March 15, 2016

Startups Push : Benevolent circular from Labour Ministry

Since the Ease of Doing Business and Startup India Standup India are flagship programs of Indian prime minister , every ministry is trying to synchronizes with the concept of ease of business particularly with newly set up startups. Earlier , Finance Minister presented Finance Bill 2016 and brought in many incentives like 100% profit exemption u/s 80IAC , long term capital gains exemption under section 54EE and section 54GB . Now , the secretary, Ministry of Labour  has issued a letter to Employees Provident Fund Organization and Employees State Insurance Corporation stating that newly set up startups should be asked to file only self declaration regarding the compliance under EPF and MP Act 1952  in first year and no inspections should be carried out by authorities . The exact relief given by Minsitry of Labour is as under :

a.   For the first year of setting up of the Start-ups, such establishments may not be inspected under EPF & MPAct, 1952.These Start-ups may be asked to submit an online self-declaration instead.

b.   Start-Ups are allowed to submit  self-certified returns  under EPF  &  MP Act,  1952. From  the second year onwards, up to three year from  the setting up of the unit, such Start-Ups may be taken up for  inspection only when very credible and verifiable complaints of violation is filed  in writing and the approval has been obtained from  the Central Analysis and Intelligence  Unit (CAIU).

The  Letter issued by the Ministry fo Labour is as under :

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