Announcement for MSME's by Finance Minister

Announcements for MSMEs

1. For standard MSMEs – Emergency Credit Line - Collateral Free Loan for MSME up to for 4 years repayment period with a moratorium of 1 year – 3 Lakh Crores to be given through this scheme.
2. Subordinate Debt for Stressed MSMEs – NPA or stressed MSMEs - having a problem of Equity – 4000 Crores will be given by the government which will result in banks being able to, sanction up to 20,000 Crores of Debt to Stressed MSMEs.
3. Fund on the fund to be created to infuse 50,000 Crores into MSMEs with are standard and doing viable business. Corpus of 10,000 Crores in this fund. It will help them get listed in the markets eventually.
4. Definition of MSMEs to be changed:

1. Investment Limit to be changed. An entity shall not fall out of the definition of MSME even if it outgrows the limit of the investment.
2. Turnover Definition added to MSME Definition
3. Differentiation on MSME definition between manufacturing and services sectors
   removed.
4. New Investment Limits:
   i. Micro: Investment up to Rs. 1 Crore
   ii. Small: > 1 Crores <10 Crores
   iii. Medium: >10 Crores <20 Crores
5. Turnover Limits:
   i. Micro: Turnover up  5 Crores
   ii. Small: Turnover > 5 Crores < 50 Crores
   iii. Medium: Turnover > 50 Crores < 100 Crores

Other Measures to increase business/ liquidity

1. overnment procurement – Tenders up to 200 Crores not to be Global Tenders and will be available only to Local Entities which will also benefit MSMEs.
2. E-Market Linkage to be made available to all MSMEs in absence of the possibility of participating in Global Trade Fairs.
3. All GoI & CPSEs to honor and release pending payments for all pending bills in the next 45 Days.

Relief for EPF Mechanism

1. Liquidity relief to be given to all EPF establishments where 10% Employee Contribution and 12% Employer Contribution. Relief is given for various establishments for 3 months to be extended to 3 more months, i.e. June, July & August. 2500 Crores will be given out through this mechanism.
2. EPF Scheme now extended to entities not eligible for other schemes by reducing Statutory PF Contribution from 12% to 10% for Private Employers. Liquidity relief from this step expected to 6500 Crores
   

Other Reliefs

1. For NBFCs, HFCs, MFIs Investment-grade debt papers (Fully guaranteed by the CG) may be issued by them to increase liquidity and fund MSMEs using the said investments. 30,000 Crores to be inducted through this route.
2. For NBFCs, 45,000 Crores to be infused by increasing the scope of the existing scheme. The first 20%
   loss in any papers or debt schemes to be borne by GoI.
3. Support to DISCOMs: Emergency liquidity induction of 90,000 Crores in all Discoms against their receivables by REC and PFC.
4. Relief to Contractors: Extension of up to 6 months (without costs to the contractor) to be provided by Central Government agencies (Like Railways, Ministry of Road Transport), CPWD, etc). These agencies to partially release Bank Guarantees for PPP Projects to the extent of completion of work.
5. Extension of Registration and completion date of real estate projects under RERA.

Tax Reliefs:

1. All TDS rates to be decreased by 25% w.e.f. 14.5.2020 and will last up to 31.3.21 – This reduction will      release 50,000 Crores
2. Pending Refunds for various entities (Charitable Trusts and non-corporate entities) shall be granted immediately.
3. Due date of all ITRs for FY 2019-20 to 30.11.2020.
4. Tax Audits due date extended to 31.10.2020
5. Assessment barring time limit extended from 30.9.2020 to 31.12.2020. Those getting barred on 31.03.2020 to be extended to 30.9.2021.
6. No additional amount to be paid for the V2V scheme up to 31.12.2020.