One of the demands is that the government should move educational services to the 5% GST slab or remove GST altogether.

From tax benefits to financial sops What EdTech startups want from the interim budget
Money Budget Monday, January 28, 2019 - 15:51

With the interim Budget around the corner, it remains to be seen if the government continues to give a push to its flagship programmes - Startup India, Digital India, Make in India or resorts to more populist measures ahead of the general elections and what kind of funds distribution this will entail. Besides, sticky issues like angel tax are also yet to be resolved.

Here are six edtech startups and their expectations from the interim budget:

Divya Jain, CEO, and Founder, Safeducate 

"In the previous Budget of 2018, the Government took key steps in skilling and also increased the funds. In Budget 2019, we expect that the Government should take key steps in raising the quality of skills to levels demanded by a potential employer or even required for a person to start one’s own business. The focus should be on integrating strategies to increase skilling outcomes and sustain economic growth. Current skill development initiatives should be integrated with nation-building mission programmes. As an Organisation which provides skilling and gets funded from the Government to execute the Skilling programme, we seek some tax benefits. Constructing the Skilling centre requires a lot of physical material which is being charged along with GST. We are not being able to reclaim the GST we had paid in the Inward supplies. Also, we have various certification and degree programmes in Logistics and Supply chain management where we are not being exempted from GST. The Government should give support in terms of medical allowance for students that are being trained in skilling programmes. As technology is changing, the Government needs to allocate more funds to improve the quality and develop excellence in Skilling centres.  

Beas Dev Ralhan, CEO, and Founder, NextEducation India Pvt. Ltd.

"The budgetary allocation for education in 2018 stood at 3.5% of the entire budget, with a special focus on digitised classrooms, ICT-enabled learning, and quality teacher training programmes. However, the overall improvement of the education sector requires more prioritised attention and funding. With the General Budget around the corner, we have high hopes from the government and expect that a substantial amount would be set aside for the education sector so that we can lay a stronger foundation for new-age learning strategies. The prerequisite for quality education becoming available to all is free and easy access to quality e-learning resources. This can be initiated by the government through technologies such as artificial intelligence, virtual and augmented reality and cloud computing. It is also important to ensure that internet access provided to rural areas is functional so that students from those parts can use it for effective self-learning. Training teachers on the latest pedagogies and Information and Communication Technology (ICT) is the need of the hour as they are expected to employ innovative teaching methods and make use of digital tools in the classrooms. However, there is a dearth of 11 lakh adequately qualified teachers in the K–12 segments. Even though the government is trying to tackle the situation with initiatives such as Teacher Professional Development courses on the digital platform Diksha, this issue also needs prioritising in the upcoming budget. 

Amol Arora, Vice Chairman & Managing Director - Shemford Group of Futuristic Schools

"For any country, the most significant returns are those garnered from investments made in its children. The next generation is going to enter a globalised world and will be competing for jobs not just against other students but also innovative technologies that are quickly replacing human jobs. In order to keep our children in the competition, we need to ramp up our EdTech sector in the years to come. To that end, Budget 2019 should give certain tax breaks to EdTech startups to enable them to reach sustainable levels. The government should also grant financial incentives for organisations setting up educational institutes in rural and underserved areas. Currently, the private sector in education is viewed with distrust which is why concrete steps should be taken to show that public-private partnerships can be a win-win for all – delivering quality without fleecing the parents.

Kiran Babu, founder and CEO, Egnify

This T-Hub startup believes that education should help in getting students’ career and future-ready. "This can only happen when government initiates policies to give more impetus to the adoption of technology for creating a system where teaching is personalised and learning is adaptive. We as Edtech entrepreneurs want to see efforts to increase the infusion of funds into edtech sector. 'The Startup India fund' initiative of the Government looked promising but implementation was not impressive. Of the Rs.10,000 crore corpus, only 20% has been allocated to VC funds," Kiran Babu says.

Sriram, co-founder and CEO, IndigoLearn

The biggest expectation is clarity on Angel tax. Startups across sectors will be impacted by draconian provisions of Angel tax. We hope the Finance Minister takes a considerate view of the cumbersome provisions and provides immediate relief to both Angel Investors as well as startups.

Jatin Solanki, Founder of Eduisfun, an edtech gaming startup, which is a part of Palava Accelerator, run by Zone Startups and Lodha

According to Jatin, schools are struggling with a deficit of teachers. In a recent survey of Gujarat Education department, it was found that 12,000 schools are run by just one or two teachers. The government needs to provide encouragement by allocating budget for technology-based learning within the schools. It could also be done by integrating online learning curriculum within the regular curriculum. "The government should design reforms for improving government school infrastructure like computer labs, Internet connectivity, smart equipment to enable e-governance in school and educational institutes," he says. 

"In a country with over 200 million students, online education can play a major role in improving learning outcomes on a large scale. The government needs to actively support early-stage industries like EdTech that can create impact at scale. Today, the GST rate for all educational services outside of schools & colleges is 18%, which is same rate bracket as discretionary items such as perfumes, chocolates etc. The government should move educational services to the 5% GST slab or remove GST altogether," Jatin adds.

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