In a letter to the Central Board of Direct Taxes (CBDT) , the EEPC India has stated that the Sabka Vishwas (Legacy Dispute Resolution) Scheme 2019 for settlement of pending cases under Central Excise and Service Tax has resulted in great success , giving a big relief to medium and small enterprises.
"A similar scheme may be considered for settlement of custom duty matters including the settlement of non-fulfillment of obligations against EPCG and advance authorisation licence granting waiver of interest and penalty. This will be of great relief to the MSME exporters", said EEPC India.
EEPC India has also sought a tax dispensation for the MSME non-corporate exporters, similar to the corporates which have been rightly given major reduction in the corporate tax at 22 per cent and surcharge of 10 per cent. The non-corporate MSMEs are still taxed at 30 per cent and a surcharge of 12 per cent. Most of the MSMEs are growing with internal accruals as they don’t get much of the assistance from banks and financial institutions, as they cannot provide the collateral security to their satisfaction.
The exporters' body, representing the largest contributors to the country's export basket , said that the Taxation Laws (Amendment) Act, 2019, inserted section 115 BAA and section 115 BAB in the Income Tax Act, 1961, to provide certain domestic manufacturing companies to be taxed at a concessional tax rates. The newly inserted section 115 BAB provides that only a company registered on or after 01.10.2019 will be qualified for this section to be taxed at a concessional rate of 15 per cent." We urge you to extend this benefit of 15 per cent to the existing MSME manufacturing units as well, so that the funds saved on account of reduced tax can be used by the units for capacity expansion and technology upgradation''.
In another submission to CBDT, the EEPC India said Clause 30 of the Finance Bill seeks to amend section 57 of the Income-tax Act relating to deductions. Clause (i) of the section allows deduction of any reasonable sum for the purpose of realising such dividend''It is proposed to insert a proviso to the said section so as to provide that no deduction shall be allowed from the dividend income or income in respect of units of a Mutual Fund other than deduction on account of interest expense and in any previous year such deduction shall not exceed twenty per cent of the dividend income, or income in respect of such units, included in the total income for that year without deduction under that section. These amendments will take effect from 1st April, 2021 and will, accordingly, apply in relation to the assessment year 2021-2022 and subsequent assessment years. We urge upon you to extend the deductibility of the entire expenditure laid out or expended wholly and exclusively for the purpose of earning such income.''
Download The Economic Times News App to get Daily Market Updates & Live Business News.