Modi government announces a big budget package of 20 lakh crore a relief in this COVID-19 pandemic
Government took six major steps in MSMEs these are as follows:
Step-1
20% top-up loan, to outstanding loan (as on 29.02.2020) Collateral Free Automatic Loan for MSME. Those MSME having Loan up to 25cr and turnover up to 100cr will be covered in this scheme. 100% Central Government Guaranteed. This loan will be for 4 Yrs with a Moratorium of 12 Months.
Step-2
20,000Cr will be infused as Subordinate Debt for stressed MSME thru CGTSME Trust.
Step-3
There is a Fund of Fund to be created. Rs 50,000cr will be infused as equity to standard MSME that will help MSMEs to expand their capacities.
Step-4
Definition of MSME changed. Investment Limit which defines a SME is changed. Now turnover criteria are also introduced. Different between manufacturing and service SME is removed. Micro Units- Investment limit increased to 1Cr from 20Lakh. And Turnover can be up to 5Cr. Other changes are also done. For Medium Enterprise the limit increased to 10 Cr Investment and turnover 50Cr. 20Cr and 100Cr
Step-5
Tenders up to 200Cr relating to Government procurement will not be Global Tenders any more. MSME will get big benefit out of it
Step-6
Central Government outstanding will be cleared within 45 Days by Government Help of all MSME.
For EPF
• EPF Payment was paid by Government for Mar, April and May now Extended by another 3 Months. 12%+12% will be paid by Government of India.
• Contribution reduced from 12% to 10% for those organizations having more than 100 employees is done now.
NBFC, MFI, HFC
• Special 30,000cr Liquidity window will be given. Government will buy debt papers of these institutions even if investment grade. These will be fully guaranteed by government of India.
• To Give 45,000cr Liquidity to NBFC. First 20% Loss will be borne by Government of India. Even unrated papers will get money under this scheme.
Contractors
• Month extension will be given to all Government contractors of Railways, Roads, other departments. Government Agencies will partially release Bank Guarantees to the extent of work completed.
Real estate
• Covid19 can be treated as act of God. Using the Force Major Clause the project registration will be extended by 6 Month automatically. Completion dates of existing projects to be extended automatically by 6 Months by Government authorities.
Taxation
• Non Salaried TDS and TCS rates will be reduced by 25% (from existing Level rates). This will be effective from tomorrow and will remain till 31-03-2021.
• All Pending Refunds will be issued immediately to all to 5 lakh.
• For AY 2020-21 the ITR filing Dates extended to 30th Nov 2020, And Tax Audit Date extended to 31st October 2020.
