Categories: Business

Highlights of relief package announced by Finance Minister

Highlights of relief package announced by Finance Minister

new Delhi. Finance Minister Nirmala Sitharaman today shared the first piece of information after the announcement of Prime Minister Narendra Modi's mega package. Today's package was mainly for small cash-strapped companies and businesses, contractors or small lending companies. Along with this, efforts were also made to solve the problem of the power companies. In today's package, relief of more than 5 lakh crores was announced. Know which sector got what out of it today.

MSME Sector

Finance Minister Nirmala Sitharaman on Wednesday announced an unsecured Rs 3 lakh crore loan facility for the MSME sector. This facility is expected to benefit 45 lakh small enterprises. This loan will be given for four years and there is also a provision for relief in installment for 12 months. Apart from this, loans worth Rs 20,000 crore will also be provided for the crisis-hit MSME units. 2 lakh units are expected to benefit from this. A 'Fund of Fund' is being set up for better performing MSMEs, through which equity capital of Rs 50,000 crore will be infused into MSMEs with growth potential. At the same time, it has been announced to increase the upper limit of investment and business for MSME industries in order to continue the benefits of MSME with expansion. At the same time, global tenders will not be issued in government purchases of up to Rs 200 crore to make more opportunities for domestic small industries.

Relief to salaried employees

There have also been many announcements for contribution to the Employees Provident Fund (EPF), to reach more salable expenses for salaried employees. It has been decided to reduce the statutory contribution of the company and employees in EPF from 12 per cent to 10 per cent for private companies. These cuts are for the next 3 months. During this period, the deduction for PF will be less and employees will be able to take more money home. Along with this, the PF exemption being provided under the Pradhan Mantri Garib Kalyan Yojana has been extended for the next 3 months. In which the EPF government will bear less than 15 thousand people in an institution with less than 100 employees. For this, the government will provide assistance of Rs 2500 crore, this will benefit 72 lakh employees.

TDS rates cut

The current rates of tax deduction at source ie TDS and tax collection at source ie TCS have been cut by 25 percent. These deductions in TDS will be available on contract payments, professional fees, interest, rent, dividend, commission or brokerage income. These exemptions on tax cuts will be implemented from Thursday and continue for the rest of the financial year. According to the Finance Minister, the taxpayers will get a relief of Rs 50,000 crore from this step. Along with this, the deadline for income tax return, audit and assessment has also been extended.

NBFC, Housing Finance and Micro Finance Companies

Announced a special cash scheme of Rs 30,000 crore for non-banking finance companies (NBFCs) and micro-lending companies with very small loans. Also announced a Rs 45,000 crore partial credit guarantee scheme 2.0 for NBFCs, housing finance companies (HFCs) and micro-finance institutions (MFIs) with lower level credit ratings. According to the Finance Minister, these steps will give cash to small finance companies, so that they will be able to give more loans to small and small sector.

Contractors working in infra and real estate

The government has announced extension of up to six months to the contractors of roads, railway projects and other works to complete their work. Along with this, in the case of real estate projects, the deadline for registration of contractors from completion of work has been extended to six months. According to the government, this will significantly reduce the pressure on the small companies and contractors engaged in the contract, while the government agencies can issue their partial bank guarantee to overcome the cash crunch at the level of the contractors. That is, the bank guarantee can be freed according to the work done by the contractors.

Power distribution companies

Power distribution companies have suffered significant loss of income due to sharp drop in demand due to lockdown. The government will provide cash worth Rs 90,000 crore to the companies to help them overcome the current financial crisis.

This post was published on May 14, 2020 12:26 am

Content Team

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