Question

Which of the following tax was abolished by Finance Minister through Union Budget July 2024?

• A. Krishi Kalyan Tax
• B. Angel Tax
• C. Swachh Bharat Tax
• D. Fringe Benefit Tax

Answer 1

Answer:

B. Angel Tax

•Angel tax is a term used to describe the tax imposed on funds raised by startups from angel investors. • It's formally known as Section 56(2)(vii b) of the Income Tax Act.   •The concept of angel tax was first introduced in the 2012 Union Budget by then Finance Minister Pranab Mukherjee. •The primary goal was to curb money laundering activities disguised as investments in startups and to identify fraudulent companies. •Angel tax was seen as a significant burden on startups, as it could consume a substantial portion of their funding. •Recognizing the challenges faced by startups, Finance Minister Nirmala Sitharaman announced the abolition of angel tax in July 2023.