20
Apr

Key takeaways from FM Nirmala Sitaraman’s Relief Package

Finance Minister Nirmala Sitharaman announced a relief package to help fight the Covid-19 outbreak. Here’s a brief of few relief points out of many that she covered in her speech.

For construction workers,

  1. States to use INR 31K crore construction workers welfare fund.
  2. States to use the district mineral fund for medical activities.

Rs 1.7 lakh crore package: It is for those who are in “immediate need” with an aim to put money in their hands

Health insurance cover: Rs 50 lakh per person for frontline warriors (doctors, nurses, sanitation, ASHA or government workers)

Garib Kalyan Anna Yojana: 5 kg of wheat/rice per person will be given for next three months in addition to the 5 kg which is already given; 1 kg of pulse per household

Self-help group women dealing with livelihood missions: Collateral free loan amount increased to Rs 20 lakh from Rs 10 lakh

Along with all the above measures, she also covered many aspects on tax filing, GST,  bankruptcy, customs and more. Here a glimpse,

Organised sector

  • Govt to pay EPF contribution (both employer and employee) for next three month for those establishments which have up to a 100 employees and 90% employees earning less than Rs 15,000
  • Workers can withdraw up to 75% from the PF funds (non-refundable advance) or three months of wages (whichever is lower)

Tax measures

  • For the Financial year 2018-19, the last date for returns extended to June 30, 2020. For delayed payments made till June 30, interest rate reduced to 9% from 12%.
  • For delayed deposit of TDS, interest has been reduced to 9% from 18%
  • Aadhaar-pan linking extended to June 30 from March 31
  • Vivaad se Vishwaas scheme extended to June 30. And no additional payment of 10% to be paid.

For GST

  • All GST returns for March, April, May and composition returns extended to June 30, 2020
  • For companies less than 5 cr, no late fee and penalty to be charged. For above Rs 5 cr, only int at the rate of 9%

For Customs

  • Sabka Vishwaas scheme for indirect taxes having the last date till March 31 has been extended to June 30,2020. No interest to be levied.
  • Customs clearance till June 30 to work 24×7.

For Companies

  • In respect of the MCA21 registry, there is a moratorium being issued from April 1 till Sep 30 no additional fees for late filing.
  • There is a mandatory requirement for holding Board meetings. We are relaxing it for 60 days for the next two quarters.
  • For newly incorporated cos, additional time of six more months is being given for filing declaration of commencement of business
  • If there is a company director who does not comply with the minimum residency requirement of 182 days, this was treated as a violation. It shall not be treated as one.

For Insolvency and Bankruptcy Code

  • The threshold of default is Rs one lakh as of now. From Rs one lakh it is being raised to Rs one crore to prevent triggering of insolvency proceedings for SMEs.
  • If it continues like this beyond April, then sec 7, 9, 10 of the IBC will be suspended for a period of six months.

Source: The Economic Times, March 31, 2020.

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