Business News | Budget 2023: FM Revamps Credit Guarantee Scheme for MSMEs Via Rs 9,000-crore Infusion
Get latest articles and stories on Business at LatestLY. Describing micro, small and medium enterprises (MSMEs) as growth engines of our economy, Nirmala Sitharaman's Budget proposes enhanced limits for micro-enterprises and certain professionals for availing the benefit of presumptive taxation.
New Delhi [India], February 1 (ANI): Union Finance Minister Nirmala Sitharaman on Wednesday announced the revamping of the credit guarantee scheme for MSMEs through the infusion of Rs 9,000 crore in the corpus. The revamped scheme will take effect from April 1, 2023.
The Finance Minister during her speech in Lok Sabha said that this would enable additional collateral-free guaranteed credit of Rs 2 lakh crore. "Further, the cost of the credit will be reduced by about 1 per cent," she said.
Describing micro, small and medium enterprises (MSMEs) as growth engines of our economy, Nirmala Sitharaman's Budget proposes enhanced limits for micro-enterprises and certain professionals for availing the benefit of presumptive taxation. The minister proposed raising the income range for small enterprises from Rs 2 crore to Rs 3 crore and for professionals from Rs 50 lakh to Rs 75 lakh to avail the presumptive taxation scheme.To support MSMEs in timely receipt of payments, the Budget allows a deduction for expenditure incurred on payments made to them only when payment is actually made, according to her speech.
Under the current provisions, in case of small businesses a sum equal to 8 per cent or 6 per cent of the turnover or gross receipts is deemed to be the profits and gains from business subject to certain conditions.
In case of professionals, a sum equal to 50 per cent of the gross receipts is deemed to be the profits and gains from business.
The government's Emergency Credit Line Guarantee Scheme (ECLGS) was extended up to March 2023 from March 2022. Its guarantee cover was also expanded by Rs 50,000 crore to a total cover of Rs 5 lakh crore in the last Budget, with the additional amount being earmarked exclusively for the hospitality and related enterprises.
An Entity DigiLocker will be set up for use by MSMEs, large business and charitable trusts. This will be towards storing and sharing documents online securely, whenever needed, with various authorities, regulators, banks and other business entities.The Finance Minister said this will unleash innovation and research by start-ups and academiaThe Finance Minister also announced that an Entity DigiLocker will be set up for use by MSMEs, large businesses and charitable trusts for storing and sharing documents online securely, whenever needed, with various authorities, regulators, banks and other business entities. Anonymisation is a data processing technique that removes or modifies personally identifiable information; it results in anonymised data that cannot be associated with any one individual.
The Budget has a slew of proposals for the cooperative sector. It also included that new cooperatives that commence manufacturing activities till March 31 next year shall get the benefit of a lower tax rate of 15 per cent.The Budget provides an opportunity to sugar cooperatives to claim payments made to sugarcane farmers for the period prior to assessment year 2016-17 as expenditure. A higher limit of Rs 2 lakh per member has been provided for cash deposits to and loans in cash by Primary Agricultural Cooperative Societies and Primary Cooperative Agriculture and Rural Development Banks. The Budget proposes a higher limit of Rs 3 crore for TDS on cash withdrawal for cooperative societies. (ANI)
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