Finance Minister Nirmala Sitharaman made a major announcement on TDC and TCS on Wednesday. He said that it has been decided to cut the TDS / TCS rate by 25 percent on all types of payments except non-salaried payments by 31 March 2020. This move of the government will save more money to be spent in the hands of the people.
The Finance Minister also announced to extend the deadline for filing income tax returns with it. Earlier, he said that the government would give a loan of three lakh crore rupees to the micro, small and medium industries (MSME) sector without any guarantee. He said that it is a collateral-free loan guarantee scheme. 6 steps have been announced for MSMEs. Also, earlier reliefs given to some companies regarding EPF have been announced to continue for the next three more months. Also, private companies have been allowed to contribute 10 percent to the PF fund instead of 12 percent for the next three months.
Know the finance minister said:
3 lakh crore unsecured loan for MSME sector
45 million MSMEs to benefit from collateral-free loans
4-year loan to be given to MSME
Loans up to 25 crores will benefit 100 crore turnover
The principal will not pay the first 12 months
20 crores out of 3 lakh crores for NBFCs
50000 crore fund will be created for MSME
50 thousand crore fund will be created for MSME
Definition of MSME will change
MSME to be linked to e-market
90 thousand crores cash will be poured into discoms
10 crore to 50 crore company will be small
There will be no global tender of fewer than 200 crores. MSMEs will be given benefits.
There will be an investment of 2500 crores in EPF.
The first relief for EPF will also be given by the government in June, July, and August.
72 lakh employees benefited from government support in EPF
Private companies’ contribution to EPF was reduced from 12 percent to 10 percent.
The employer gains 6800 crores from EPF deduction: Finance Minister
Cash facility of Rs 30,000 for NBFCs, housing finance companies, and MFIs
Discom faced a huge cash flow problem: Finance Minister
Emphasis will be placed on e-market linkage for MSMEs
The government will pay the remaining MSMEs within 45 days
25% reduction in TDS rate
Will apply to all types of payments
Will be applicable from tomorrow until 31 March
The due date of income tax returns for the year 2019-2020 has now been increased from 31 July and 31 October to 30 November 2020.
Announcing a major relief for the contractors, the Finance Minister said that all the central agencies would give the contractors an additional six months to complete the work at no charge.
Giving big relief to real estate developers, the government has extended the deadline for completion and registration of the project by six months.
Government to infuse Rs 50,000 crores liquidity by reducing rates of TDS, for non-salaried specified payments made to residents, and rates of Tax Collection at Source for specified receipts, by 25% of the existing rates. #AatmaNirbharBharatAbhiyan pic.twitter.com/LR1jhG9ovY
— PIB India #StayHome #StaySafe (@PIB_India) May 13, 2020
Earlier, he said that 5-5 kg of rice/grain was distributed to 80 crores poor. 8 crore Ujjwala scheme beneficiaries are being given three months free cylinder. Announcements made under the Garib Kalyan Yojana are being met.
Statutory PF contribution by employer reduced to 10 pc from 12 pc earlier; to provide Rs 6,750 cr liquidity relief: FM
— Press Trust of India (@PTI_News) May 13, 2020
Regarding the economic package of Rs 20 lakh crore, the Finance Minister said that this package has been prepared after talks with all the parties. Sitharaman said that the industry was taken care of in the package. He said that this package was necessary to speed up development.
He started his press conference with a self-sufficient India campaign. He said that PM Modi presented the vision of self-reliant India in front of the country. The Finance Minister expressed confidence that this package will make India self-reliant. The Finance Minister said that making the local brand global is part of the self-reliant India Mission.
Finance Minister Nirmala Sitharaman said that there are five pillars of self-reliant India – economy, infrastructure, system, demographics, and demand.
The package was announced by Prime Minister Narendra Modi on Tuesday during his address to the nation. Prime Minister Modi said that this package is being brought with a resolve to make the country self-sufficient in this era of the Coronavirus crisis. He said that these packages are for the workers, farmers, middle class, cottage industries, and MSME sector of the country.
In a major initiative Government announces Rs 3 lakh crores Collateral-free Automatic Loans for Businesses, including MSMEs. #AatmanirbharBharat pic.twitter.com/jgnWeKYrWs
— PIB India #StayHome #StaySafe (@PIB_India) May 13, 2020
You can watch the Finance Minister’s press conference live from here:
Essentially this is to spurt growth and to build a very self reliant India and that is why this whole initiative is called #AtmanirbharBharatAbhiyan: Finance Minister Nirmala Sitharaman. #EconomicPackage pic.twitter.com/Z2VLTpH8i4
— ANI (@ANI) May 13, 2020
The central government had earlier announced an economic package of Rs 1.70 lakh crore in March. Under this package, the government announced free grain as well as cash transfers for poor women and the elderly. The government named it the Pradhan Mantri Garib Kalyan Yojana.
- LIVE Modi address nation: 20 lakh crore special economic package announced, every class will get relief
The package was required due to lockdown:
The lockout is in force from March 25 to prevent the spread of coronavirus infection in the country. Due to these economic activities have come into a complete stalemate. The business has come to a standstill. This has affected the livelihood of many people. In this context, the economic package was in dire need, and demand was being made in various sectors.