To boost micro, small, and medium enterprises (MSMEs) and improve ease of doing business, Assocham has proposed the creation of integrated infrastructure townships and universities dedicated to skill development and entrepreneurship. The aim is to enhance growth and support within the sector, the apex trade body said on Monday.
During a pre-budget meeting with Finance Minister Nirmala Sitharaman, Assocham recommended several measures to encourage investment. These include expanding the scope of presumptive taxation to MSMEs and new-age businesses such as data centres, data hosting, and cloud computing.
According to Sanjay Nayar, President of Assocham, this would help simplify compliances in the hands of such taxpayers by computing income on a predetermined basis, thereby reducing the apprehension of tax disputes and litigation.
“It also enables businesses to avoid complex audits/bookkeeping while knowing their tax liability in advance, allowing businesses better financial planning and management,” Nayar added.
He also highlighted the need to develop integrated infrastructure townships for MSMEs (a revised version of the old Industrial Estate Development Programme) across the country.
These townships may include common testing and R&D facilitating centres, financial institutions, common service providers, housing for labour, schools, hospitals, training centres for labour and export assistance centres, among others.
Despite the policy for collateral-free loans, MSMEs still face challenges in accessing credit.
Banks often request personal property collateral and charge higher interest rates, hindering credit access.
Nayar stated that it must be made mandatory for banks to disclose the number and amount of collateral-free loans granted periodically.
The upcoming budget provides an additional allocation or net to enhance credit flow to the MSMEs, much like the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) launched during Covid-19, which proved to be a lifeline driving the growth of MSMEs.
–IANS
