Nirmala Sitharaman Press Conference Highlights: Booster Shot for MSMEs, Income Tax Payers Get New Return Deadline and TDS, TCS Rate Cuts - News18

Nirmala Sitharaman Press Conference Highlights: Booster Shot for MSMEs, Income Tax Payers Get New Return Deadline and TDS, TCS Rate Cuts | May 14, 2020, 3:20 PM IST
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Nirmala Sitharaman Press Conference LIVE Updates: Finance Minister Nirmala Sitharaman on Wednesday announced 15 measures to revive and support business under the Rs 20 lakh crore stimulus package announced by Prime Minister Narendra Modi on Tuesday.

Giving details about the measures, the minister said that six are exclusively meant for the MSME sector, while the others pertain to real estate, NBFCs, and income tax payers. Attempts have also been made via these measures to decrease the regulatory burden on companies, while increasing the take-home pay of employees.
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May 13, 2020 9:12 pm (IST)

"They had brought the economy to its knees even before the pandemic. From both the PM and the FM we were expecting some immediate relief for the working class and the migrants. This has not come. They did not address the issues of joblessness and hunger. The FM's address was just regurging and promotion of the government's economic policy over the last six years which had led to the economic crisis in the first place even before coronavirus," said CPI general secretary D Raja.

May 13, 2020 9:09 pm (IST)

We are witnessing the pettiest form of politics from Modi govt. There is nothing for the state govts which have been asking for funds, as they are at the forefront of fighting the pandemic. Nothing for them, not even their legitimate dues!— Sitaram Yechury  

May 13, 2020 9:05 pm (IST)

Economic Package a 'Farce': Left | The Left parties said the economic package announced by Finance Minister Nirmala Sitharaman failed to address the immediate concerns of people, describing it as a "farce" that propagated the policies which had in the first place led to an economic crisis even before the onset of the coronavirus pandemic. "The so-called 'package' by Modi govt is a farce. Those who urgently and immediately need help are walking hungry on the roads or looking for a meal from somewhere. This is completely insensitive to the existential crisis being faced by crores," CPI(M) general secretary Sitaram Yechury said.

May 13, 2020 8:43 pm (IST)

READ | Your Take Home Salary to Go up as Centre Reduces EPF Contribution to 10% for the Next 3 Months

The government says that this move will provide relief to 6.5 lakh establishments and will provide Rs 6,750 crore worth of liquidity over the next three months.

May 13, 2020 8:14 pm (IST)

Explaining the meaning of 'atmanirbhar' in different languages, Finance Minister Nirmala Sitharaman on Wednesday said that the Rs 20 lakh crore economic package will spur growth and build a self-reliant India. She further said that it will help push local brands to be competitive at the global level, but not make India an isolationist economy. Here are top highlights from her speech

May 13, 2020 8:03 pm (IST)

READ | No Clear Indication in PM's Special Package Announcement of Where Funds Will Come from: Puducherry CM

The Prime Minister's announcement has evoked both appreciation and confusion among the people, he said.

May 13, 2020 7:38 pm (IST)

Senior Congress leader and Chief Minister V Narayanasamy on Wednesday said the Rs 20 lakh crore economic stimulus package announced by the Prime Minister had no clear indication of where the funds will be available from, what the schemes were and who would be the beneficiaries. The Prime Minister's announcement has evoked both appreciation and confusion among the people, he said.

May 13, 2020 7:18 pm (IST)

Prime Minister Narendra Modi said the announcements made by the government on Wednesday to boost the economy will go a long way in addressing issues faced by businesses, especially MSMEs.

May 13, 2020 7:00 pm (IST)

On top of the falsehood in the name of financial relief, the centre is also misleading people. There is nothing great in extending tax deadlines, it is obvious.❞ (2/2)

May 13, 2020 6:58 pm (IST)

Mamata Banerjee on Today's Announcements by FM | Meanwhile, addressing a press conference, West Bengal Chief Minister Mamata Banerjee, says, "The Centre's announcement is a big zero. The states have been given nothing, no money transferred. Nothing on public spending, no additional grant to combat Covid-19." (1/2)

May 13, 2020 6:52 pm (IST)

READ | FM Nirmala Sitharaman Announces Rs 30,000 Crore Special Liquidity Scheme for NBFCs, HFCs & MFIs

Sitharaman noted that these finance institutions are finding it difficult to raise money in debt markets and many institutions have not been able to take advantage of the recent relaxations given by the government and the Reserve Bank of India. Under the scheme, investments will be made in both primary and secondary market transactions in investment grade debt paper of these institutions.

May 13, 2020 6:47 pm (IST)

The government also extended the due date of all income tax returns for the financial year 2019-20 from 31 July 2020 and 31 October 2020 to 30 November 2020. The due date of tax audits from 30 September 2020 has been pushed to 31 October 2020.

May 13, 2020 6:41 pm (IST)

READ | TDS and TCS For Non-Salaried Payments Cut by 25%. Here's What It Means For You

This reduced rate of TDS (Tax deducted at source) and TCS (Tax collected at source) will be available for payment for contract, professional fees, interest, rent, dividend, commission and brokerage income.

May 13, 2020 6:36 pm (IST)

TCS, on the other hand, is the tax payable by a seller which he collects from the buyer at the time of sale. Section 206C of the Income-tax act governs the goods on which the seller has to collect tax from the purchasers. (4/4)

May 13, 2020 6:35 pm (IST)

However, individuals are not required to deduct TDS when they make rent payments or pay fees to professionals like lawyers and doctors.TDS is an advance tax. It is tax that is to be deposited with the government periodically and the onus of the doing it on time lies with the deductor. (3/4)

May 13, 2020 6:33 pm (IST)

Tax deduction at source is a means of collecting tax on income, dividends or asset sales, by requiring the payer to deduct tax due before paying the balance to the payee.In India, under the Indian Income Tax Act of 1961, income tax must be deducted at source as per the provisions of the Income Tax Act, 1961. TDS is deducted for payments of salaries, interest payments by banks, commission payments, rent payments, consultation fees and professional fees. (2/4)

May 13, 2020 6:31 pm (IST)

What TDS, TCS Rate Cut Means for Taxpayers | Finance Minister Nirmala Sitharaman today announced reduction of the tax deducted at source for non-salaried income by 25 per cent of the existing rates along with tax collected at source. The reduced rates will be applicable starting Thursday and be valid till March 31, 2021. This reduced rate of TDS (Tax deducted at source) and TCS (Tax collected at source) will be available for payment for contract, professional fees, interest, rent, dividend, commission and brokerage income. (1/4)

May 13, 2020 6:05 pm (IST)

READ | Centre's 6-Point Strategy to Revive MSMEs Has Rs 3 Lakh Crore Collateral-Free Loan and New Definition for Firms

The Centre revised the definition of MSMEs to help more firms fall under its purview. Investment limit will be revised upwards and additional criteria of turnover has also been introduced.

May 13, 2020 6:01 pm (IST)

Here's how the government plans to finance the Rs 20 lakh crores stimulus:

May 13, 2020 5:43 pm (IST)

"Banks are not shying away from disbursing loans, but many customers are saying that they will avail loans after end of lockdown, this is one reason why sanctioned loans are not being released," says FM.

May 13, 2020 5:33 pm (IST)

Rs 50,000 Crore Liquidity Through TDS/TCS Rate Reduction

May 13, 2020 5:25 pm (IST)

"All pending refunds of charitable trust, non-profit business, cooperatives and small partnerships, shall be issued immediately. Due date of all I-T returns for FY19-20 from July 31, 2020 and October 31, 2020 extended till November 31, 2020. Tax audits extended from September 30, 2020 till October 31, 2020. Date of assessments getting barred as of September 2020 is extended till December 2020. Those getting barred on March 31, 2021 are being extended till September 31,  2021. Vivad se Vishwas scheme is being extended till December 31, 2020 without any additional amount," says Sitharaman.

May 13, 2020 5:21 pm (IST)

TDS Rates Reduced by 25% | Reduced TDS rates by 25 percent. This is applicable on all payments - interest, rent, brokerage, supply, etc. This will be enforced from tomorrow till March 31, 2021. This reduction will release Rs 50,000 crore in hands of people, says Sitharaman.

May 13, 2020 5:16 pm (IST)

Extension of Registration & Completion Date of Real Estate Projects Under RERA

- Ministry of housing and urban affairs will issue advisories where Covid-19 can be treated as an Act of God
- Extend the registration and completion sou moto by 6 months for all registered projects expiring on or after 25 March, 2020
- Issue fresh project registration certificates automatically with revised timelines
- These measures will de-stress real estate developers and ensure completion of projects

May 13, 2020 5:09 pm (IST)

Relief to Contractors | In relief to contractors, the finance ministry announces extension of upto 6 months to be provided by all central agencies like Railways, Ministry of Road Transport and Highways, Central Public Works Dept. This will cover construction work and goods and services contracts, completion of works and intermediate milestones, and also concessional period in PPP contracts. To facilitate greater liquidity, government agencies will partially release bank guarantees to the extent of the completed contract so that cash flow improves.

May 13, 2020 5:06 pm (IST)

Rs 90K Cr Liquidity Injection for DISCOMs

- Unprecedented cash flow problem accentuated by demand reduction
- DISCOM payables to power generation and transmission companies is currently close to Rs 94,000 cr
- PFS/REC to infuse liquidity of Rs 90,000 to DISCOMs against receivables
- Loans to be given against state guarantees for exclusive purpose of discharging liabilities of Discoms to Gencos

May 13, 2020 5:01 pm (IST)

Rs 45,000 Cr Partial Credit Guarantee Scheme 2.0 for NBFCs

- Existing PCGs scheme to be extended to cover borrowings such as primary issuance of bonds/CPs
- First 20 per cent of loss will be borne by the guarantor that is the government of India
- This scheme will result in liquidity worth Rs 45,000 crore

May 13, 2020 4:56 pm (IST)

Rs 30,000 Cr Special Liquidity Scheme for NBFCs/HFCs/MFIs

- Govt will launch a Rs 30,000 crore special liquidity scheme
- Under this investment will be made in both primary and secondary market transactions in investment grade debt paper of NBFCs/HFCs/MFIs
- Will supplement RBI/govt measures to augment liquidity
- Securities will be fully guaranteed by govt of India
- This will provide liquidity support

May 13, 2020 4:56 pm (IST)

Rs 2500 Cr EPF Support | To ease financial stress as businesses get back to work, government decides to continue EPF support for business and workers for 3 more months providing a liquidity relief of Rs 2,500 crores, says finance minister.

May 13, 2020 4:53 pm (IST)

"Sixth step for MSMEs is that post COVID-19, since trade fairs and exhibitions will be difficult, we will provide e-market facilities. The Government of India and Central Public Sector Enterprises (CPSE) will honour every MSME receivable in the next 45 days," says Sitharaman.

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Nirmala Sitharaman Press Conference Highlights: Booster Shot for MSMEs, Income Tax Payers Get New Return Deadline and TDS, TCS Rate Cuts
FM Nirmala Sitharaman

For the MSME sector, the minister detailed six measures including the new definition of the sector. Accordingly, the investment limit for defining MSMEs has been revised upwards. Besides, she highlighted that additional criteria such as turnover has been considered for defining MSMEs. The Centre has also decided not to go in for global bidding for government procurement for tenders up to Rs 200 crore, thereby, promoting the participation of MSMEs, she said.

Sitharaman said that the package will spur growth and build a self-reliant India and push local brands to be competitive at the global level, but not make India an isolationist economy. She says that the package to build an 'aatmanirbhar bharat' was realised after long deliberations with all sections of the society.

Today’s was be the first of a series of press briefings by the finance minister in the coming days. The Rs 20 lakh crore sum. which is equal of 10 per cent of India's Gross Domestic Product (GDP), includes Reserve Bank of India's liquidation worth close to Rs 8.04 lakh crore along with Rs 1.7 lakh crore relief package under Gareeb Kalyan Yojana spelled out by Sitharaman last month. The balance of the economic package, details of which are not yet known, then stands at Rs 10.26 lakh crore.

In a televised address to the nation on Tuesday evening, PM Modi had announced Rs 20 lakh crore - equivalent to 10 per cent of India's GDP - in fiscal and monetary measures to support an economy badly hit by the 50-day lockdown to fight the spread of Covid-19.

The PM said the package will focus on land, labour, liquidity and laws and has been designed to keep in mind various segments of the society like the cottage industry, small-scale industry, MSMEs, labourers, farmers, middle-class taxpayers and Indian industries.

He also gave a push to local products, as he said India mission should be becoming self-reliant (Atma Nirbha Bharat). Spelling out the details, Modi had said the self-reliant strategy will depend on five pillars: growing a new economy, creating a state-of-the-art infrastructure, setting up a technology-based delivery system, leveraging the young demography and by exploiting domestic demand. PM Modi had said the details of the package would be shared by Sitharaman.

In a series of tweets after Modi’s address, the finance minister on Tuesday said “this shall not be just a financial package, but a reform stimulus, a mindset overhaul, and a thrust in governance.”

“Indian economy has acquired strength in its various dimensions. Now, we can confidently engage with the world. We aim at overall transformation & not incremental changes. We shall convert the pandemic challenge into an opportunity. #AatmanirbharBharat will integrate not isolate,” Sitharaman had tweeted.

The lockdown imposed on March 24 that led to closure of shops, factories and services, such as tourism, eateries and public transport, led to a devastating impact on the economy with thousands of companies staring at bankruptcy and millions losing their jobs.

Data from the Central Statistics Office showed on May 12 that the country’s unemployment rate touched 27.1 per cent in the week ended May 3 - the highest ever - indicating a bloodbath in the wake of the coronavirus pandemic and the lockdown.

Not surprisingly, India’s factory output, a key measure of economic activity, shrunk by 16.7 per cent, data from the Central Statistics Office showed on May 12, signalling that a widespread shutdown had bit the economy hard.

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