Maharashtra has also established its top status as the preferred state in terms of eligible startups in the Startup India programme of the central government, and it has registered the most DPIIT-recognised startups as eligible to get tax exemptions in the first ten months of 2025. This information was presented in the Parliament by the Minister of Commerce and Industry, Piyush Goyal, who showed that in the first half of the current year (between January and October), Maharashtra was able to add 116 of such entities. The performance of the state can be highlighted as a long-term trend since the state has occupied the first place in the list annually since the introduction of the Startup India initiative in 2016.

Tax exemption scheme and eligibility criteria 

Startups which are issued this eligibility certificate, as provided in Section 80-IAC of the Income Tax Act, have a significant financial benefit. These organisations are subject to a deduction amounting to 100% of the profits and gains earned on their eligible business activities. Being a useful tax holiday, it is designed to last three successive assessment years, which is essential to offer a runway to early-stage development and reinvestment.

In the last ten months, Maharashtra has been narrowly surpassed by Gujarat, which registered 110 eligible startups. The already existing startup hubs of Delhi NCR and Karnataka, otherwise well known to have a thriving startup ecosystem, were observed to be significantly behind both Maharashtra and Gujarat in the count of startups receiving the much-needed tax exemption certificate.

The Parliamentary response was an in-depth analysis of the national impact of the scheme. As of now, 4,147 DPIIT-registered startups have managed to obtain the certificate of eligibility according to Section 80-IAC. Out of this cumulative number, 546 certificates were actually issued in the first ten months of 2025, and this shows the ongoing impetus of the exemption process.

A wider picture of the startup economy in India shows that it is the third-largest startup ecosystem in the world. In official terms, as of October 31, 2025, the Department of Promotion of Industry and Internal Trade (DPIIT) officially included an incredible cumulative number of 1,97,692 under the umbrella Startup India initiative, which are recognised as startups.

The conditions under which a firm is considered to have this recognised startup status have been well stipulated. The applicant should be registered as a Limited Liability Partnership (LLP), a partnership, or a company in the form of a private limited company. The firm should not be older than ten years, and the annual turnover during any past financial year should also not exceed ₹100 crore. 

The startup should be in the process of innovation or improvement of existing products, services or processes with a clear potential of creating either jobs or wealth. It is also clarified that those entities that arise due to the dissolution or reorganisation of an entity already in existence do not qualify to receive this recognition at all.

Sectoral distribution and Government efforts

When the sectoral distribution of the startups that were able to qualify successfully in the Section 80-IAC tax exemption is considered, according to the data, there are two main sectors that take the lead. The health and life sciences industry contributed the largest number of eligible companies, with 51. This was followed instantly by the IT Services industry, which added 50 tax-exempt startups to the list in the ten months up to October.

The broader government support mechanisms were also outlined by Minister Piyush Goyal for recognised startups. By October 31, 2025, 34,400 DPIIT-recognised startups will be successfully onboarded to the Government e-Marketplace ( GeM ), through which procurement with public entities is facilitated. The success of such integration is seen in the number of orders it has generated, as the involvement of the public in this integration came to over 4.8 lakh orders with these recognised startups, with a cumulative value of more than ₹47,500 crore.

India has recorded positive outcomes through the government initiatives to enhance the Intellectual Property Rights (IPR) regime. According to the Minister, the reforms in this area have helped to receive over 16,000 additional applications to protect innovations by well-known startups, highlighting the intention to promote the protection of innovations.

Conclusion

The continued leadership in terms of the number of tax-exempt startups added in the year 2025 to date, over 116 startups have been added in the first ten months of the year 2025, which makes Maharashtra one of the biggest drivers of the emergent economy in India. This success, together with the good result of Gujarat, shows an indicative example of the decentralisation of the startup ecosystem outside the traditional hubs such as Delhi NCR and Karnataka, especially in terms of accessing certain government incentives. The information also substantiates the extensive success of the tax exemption program, which has granted more than 4,100 startups in the country, and healthcare and IT Services are some of the areas that have exploited this financial leverage.