Members of ICCI in Coimbatore request the Finance Minister to reduce rates of TDS by 25 percent of the prescribed rates as in the first phase of Covid-19 pandemic, for the financial year 2021-2022.
Coimbatore: The Indian Chamber of Commerce and Industry, Coimbatore has appealed to the Union Minister for Finance, Nirmala Sitharaman seeking certain relief measures for the Trade and Industry sector, particularly MSMEs which will enable them to revive their business activities during the second wave of the Covid-19 pandemic crisis.
In a press release issued by the ICCI members, they said:
"1. The Finance Act 2017 inserted Section 269ST prescribing that no person shall receive an amount of Rs. 2 lakhs or more from a person in a day, in respect of a single transaction otherwise than by an account payee cheque or draft or other electronic modes. This came into effect from April 1, 2017 and now this law is being tested under unprecedented circumstances.
The Section provides for the Central Government to relax such classes of persons or receipts as they deem fit from the rigours of this section. In this pandemic, the hospitals insist on advance payment through electronic mode from the Covid patients.
The families of Covid-affected patients are depending on friends and relatives to support them through electronic transfer of funds. Further there are families where the husband is in a serious condition, while wife or other members of the family are not in a position to carry out electronic transfer of funds to hospitals. Therefore it is urged that the Government should come out with a notification immediately to address this difficult situation and relax the compliance with Section 269ST.
2. The Scheme of Advance Tax is PAYE i.e. "Pay as You Earn". In these pandemic situations the opportunity for MSMEs and Traders to earn is minimal and uncertain.
Therefore the due dates for Advance Tax should be rescheduled to one installment falling in the month of March 2022 alone. This could make the cash flow available with the MSMEs and Traders to recoup the loss in the second half of the financial year. Incentives may be considered in the form of one time reduction in rates for those who pay in the existing normal installments.
3. The rates of TDS can be reduced by 25 percent of the prescribed rates as in the first phase of pandemic for the financial year 2021-2022. This request is justifiable as the income that accrues would come down to the assessees in 2021-2022 which could match the reduced rates.
4. The rates of GST could also be reduced by 25% for all commodities across all rates for a limited period like TDS Direct Tax laws. This would promote ease of doing business as well as improve cash flows in the system. Further relaxation could be considered for movement of Essential commodities and Hospital supplies.
5. A special one time Covid Deduction upto Rs. 50,000 may be given to Individual/HUF tax payer only for the assessment year 2022-2023 and Senior Citizen be given additional deductions for dependents.
6. Special Tax incentive schemes should be devised for those MSMEs who do not avail any special benefits and comply with all tax and other obligations promptly.
7. Deduction for interest on Housing Loans be increased by another Rs. 2 lakhs per annum to encourage investment in the Housing Sector.
8. Tax relief could be considered for individuals/HUFs like ELSS.
9. The Banking Sector and financial institutions should provide certain relief to the MSMEs and Trading and Small business self employed persons.
a) Moratorium for repayment of principal upto 31st March 2023.
b) Waiver of interest on loans upto 31-12-2021 with subvention scheme to the Banks and Financial Institutions.
c) The Prices of raw materials should be fixed at 2019 rates distributed to MSMEs through Government distribution channels with appropriate credit facility.
d) The Government should insist all PSUs to procure from MSMEs and monitor their payment schedules.
e) Bill discounting facilities to be provided by Banks and Financial Institutions. Deserving MSMEs should be given Seed Capital in the form of debt repayable after five years together, with interest.
We also appealed to the Hon'ble Finance Minister for sanction of certain relief to Construction Sector such as provisions of special relief by amending Section 80JJAA of the Income-Tax Act, to fix upper limit of Rs. 60 Lakhs for Houses other than affordable Housing at 5% GST and Construction Industry should be made as a Priority Industry to enable more credit facility to this sector," they added.