Fiscal support to MSMEs needed to pay employees’ salaries; refunds of unadjusted taxes a must: FICCI survey

Companies additionally sought continuation of liquidity assist and credit score enhancement measures to MSMEs from final 12 months.

The Modi authorities ought to present momentary fiscal assist in the direction of funds of wage for workers within the MSME sector and/or exempt employers’ contribution to provident fund and Workers’ State Insurance coverage for the present fiscal 12 months, business physique FICCI’s newest spherical of Enterprise Confidence Survey stated on Monday. Responses from round 180 firms with a turnover starting from Rs 1 crore to Rs 60,000 crore throughout sectors within the survey additionally requested the federal government for guaranteeing well timed refunds of unadjusted taxes and levies to minimize the affect on working capital constraints on small companies amid Covid. Respondents additionally requested for the adoption of end-to-end paperless transactions to hurry up refunds on an operational degree.

Whilst companies acknowledged the coverage assist prolonged by the Reserve Financial institution of India on Could 5, 2021, together with monetary assist to MSMEs, a number of issues on the working of the monetary system had been burdened for pressing consideration. A major chunk of respondents stated that they had been unable to avail credit score from banks as they’ve turn out to be excessively risk-averse. “The complete course of for approval of loans has turn out to be extraordinarily time consuming which severely dampens enterprise prospects,” the survey famous. The survey members additionally urged banks to boost lending at an inexpensive charge to the business. “It’s important that credit score is supplied to distressed segments of the business, in addition to to these segments which have satisfactory collateral or have nice potential to generate extra cash flows because the economic system strikes in the direction of normalization,” respondents stated.

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Companies additionally sought continuation of liquidity assist and credit score enhancement measures to MSMEs from final 12 months. Furthermore, they requested for focused fiscal assist within the type of tax waiver and monetary help to sectors that had been beforehand saved out of the stimulus package deal however had been deeply impacted by it together with journey, tourism, resorts & hospitality, and civil aviation.

Total, the enterprise confidence index within the present spherical of the survey had declined to 51.5 after reporting a decadal excessive worth of 74.2 within the earlier spherical. “Worsening in present circumstances in addition to muted expectations concerning the near-term prospects on the again of a sweeping second wave of coronavirus infections pulled down the general index worth,” the survey stated. The quantum of respondents citing weak demand as a constraining issue jumped to 70 per cent from 56 per cent respondents within the earlier spherical.