Union Budget 2020: What Did Small Businesses Get?

Union Budget 2020:

The Budget 2020-21 is out! Do you know how things are going to impact SMEs like you?

Here are 20 key announcements regarding MSMEs made by Finance Minister Nirmala Sitharaman on Feb 1st:

  1. A simpler GSTR filing system will be introduced from April 1, 2020.
  2. ₹1,000 crore is invested to help mid-sized businesses in export development, R&D and technology upgrade.
    Rs 805 crore has been allocated under Credit Linked Capital Subsidy and Technology Upgradation Scheme (CLCS-TUS) to improve competitiveness of MSMEs through technology.
  3. e-Marketplace (GeM) will be setup to procure goods, services and works from SMEs.
    3.24 lakh vendors are already on this platform.
  4. Non-banking financial companies (NBFCs) will extend invoice financing to MSMEs through TReDS.
  5. Subordinate debt will be provided by banks to provide working capital for SMEs.
  6. RBI will extend debt restructuring for one more year till March 31, 2021 (which earlier had a deadline till March 2020).
  7. An app-based invoice financing loans product will be launched.
    ✔ Problem of  delayed payments and cash flow mismatches for the MSMEs will get eliminated.
  8. Small Business turnover threshold for audit is increased from Rs 1 cr to Rs 5 cr.
    ✔ This will reduce the compliance burden on small retailers, traders & shopkeepers.
    ✔ However, this applies only to those businesses which carry out less than 5% of their business transactions in cash.
  9. Customs duty on footwear and furniture will increase.
    ✔ This is to restrict low-quality imports.
    ✔ The rate of duty for footwear is raised from 25% to 35%, and for “parts of footwear” from 15% to 20%.
    ✔ The rate for specified furniture goods is being raised from 20% to 25%.
  10. Budget 2020 proposes to improve manufacturing of mobile phones, electronic equipment, and semiconductor packaging.
  11. National logistics policy will be released
    ✔ This will create a single window e-logistics market and make MSMEs even more competent.
  12. Higher insurance cover for exports
    ✔ A new scheme is being launched to provide higher insurance cover and reduce the premium for small exporters.
    ✔ It will also simplify the procedure for claim settlements.
  13. Nirvik scheme will be introduced for export tax disbursement
    ✔ Nirvik is a New Export Credit Insurance Scheme (ECIS) by Export Credit Guarantee Corporation of India (ECGC).
    ✔ The ECGC provides credit guarantee of up to 60% loss, but under Nirvik, the insurance cover guaranteed will cover up to 90% of the principal and interest of loans and will include both pre and post-shipment credit.
    ✔ Aims to make loans easier to access for exporters and also simplify the lending process.
  14. Rs 2.83 lakh crores allocated for agro and allied sectors.
  15. Around 35 lakh farmers will be helped for setting up solar pumps to grow crops even out of barren lands.
  16. The budget also provides 152 million metric tonnes of warehousing facilities.
  17. The Khadi Vikas Yojana and Gramodyog Vikas Yojana have been allocated Rs 472 crore to develop Khadi based businesses in the villages and small towns.
  18. The National Scheduled Caste/Scheduled Tribe Hub is given Rs 150 crore to provide professional support to SC/ST entrepreneurs.
  19. A digital platform will be set up for seamless application and capture of Intellectual Property Rights (IPR).
  20. Rs 2,500 crore will be allocated for generating self-employment opportunities in the non-farm sector by helping traditional artisans and rural/urban unemployed youth.

Also Read,
1. 5 Uses of Tracking “Business Purchases” You May Not Know About!
2. 5 Reasons Why Tracking Cashflow Daily is Necessary For Business Growth!
3. 4 Big Inventory Mistakes You Could Be Making in Your Small Business!
4. 5 Things “Profit & Loss Report” Says About Your Business
5. 5 Clever Ways To Prevent Billing Disputes With Your Parties & Get Payments Faster
6.
6 Easy Tips To Pick Inventory That Sells 2X Faster

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