Budget 2019: Food startups seek fund allocation, GST rate cut on services to 5%
From dining at a restaurant to food delivery, citizens have notably, shown great enthusiasm for the latter.
There has been a drastic change in the last few years about how Indians eat and where they eat. Interestingly, from dining at restaurants to food delivery, citizens have shown deep enthusiasm over the latter. This has also intensified competition in the online market. While, food delivery is already grabbing attention, startups like Authenticook target housewives who are looking to generate income by selling home-made foods to both tourists and residents. Now, apart from Zomato, platforms like Swiggy, Foodpanda, Pizza Hut, JustEat, TastyKhana and FoodMingo are among top players. Interestingly, Uber which entered the Indian market, with online taxi service, had also launched Uber Eats.
One can definitely agree that food startups have gained massive attention. Significantly, food startups have also increased the potential for job creation across India. With such a massive potential for growth, food startups are also seeking a boost for their business from budget 2019 announcements.
Ameya Deshpande, Co founder, Authenticook, listed out these expectations from Finance Minister Nirmala Sitharaman.
1. Government's Fund of Funds (through SIDBI) should have an amount earmarked for startups which are focusing on sustainability and social impact.
In India, SIDBI acts as a principal financial institution for promoting, financing and development of Micro, Small and Medium Enterprises (MSME) sector.
2. Immersive food tourism is one of the most inclusive forms of tourism models with wide reaching impact on employment and financial independence; keeping this in mind, Government (through Ministry of Tourism) to allocate funds for creation of a program run on a PPP model for upskilling and training of local communities focusing on food quality control, hospitality and self promotion.
3. Clarity to be brought to the definition of 'innovative' startup which in turn has an impact on taxation for these startups.
4. GST rates for service businesses with a positive social impact to be reduced from current 18% to 5%.
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