Finance Minister, Nirmala Sitharaman today announced some key measures for MSMEs, Capital Markets, Auto Sector and individual tax payers. Here are 7 key measures that were announced:
1. Surcharge on capital gains tax goes
The government announced a rollback on surcharge levied on long and short term gains arising from transfer of equity and shares, both for Foreign Portfolio Investors and domestic investors. Stock markets could cheer this surcharge withdrawal as this saw some major selling by Foreign Portfolio Investors.
2. Tax notices through a central system
Beginning from Oct. 1, 2019 the issue of Income Tax orders, notices, summons, letters etc., shall now go through a centralised computer system. It will contain a computer generated document identification number. If there is no document identification number the notices would not be valid.
3. CSR not to be criminal offense
Non compliance of Corporate Social Responsibility will not be a criminal offense and would only be a civil offense.
4. Major relief for the auto sector
BS IV vehicles purchased till March 2020 will remain operational for entire period of registration. “It was a big issue,” Sitharaman said. “It’s not as if from 2020 they’re off the road. They are allowed till their registration is one.”
Finance Minister also said that a new scrapage policy would be announced. The government will also lift the ban on purchase of vehicles by government departments.
5. Delayed payments will be expedited
Delayed payments from the Government and government institutions will be expedited and monitored by the Department of Expenditure and their performance will be reviewed by the Cabinet Secretariat. All dues under litigation will be cleared.
The government will amend the MSME Act to have a single definition for MSMEs. The changes in the act will be taken up by the Cabinet soon. New definition for MSMEs will not necessarily be on turnover but also on things like plant machinery.
The GST refunds to MSMEs would also happen within 30-days.
7. Banks to pass on interest rate cuts
Banks have agreed that they will pass on any interest rate cuts through the MCLR reduction announced by the monetary policy committee.