Most was being expected from Budget 2013 by Small and Medium Scale Enterprises and other industries like increased funds availability with no interest burden, more tax benefits and other industry friendly policies. Some of these salient features are briefly narrated below.
It has been assured in Budget 2013 that all tax benefits provided to SMEs will continue up to three more years even after their growth from the SME stage to an elevated stage. This assurance removed all fears from the minds of SME entrepreneurs that they may lose their benefits and will be at risk to run the business if they grow their business from current level to a higher level. Now they can feel secured and concentrate on their growth enjoying all subsidies and tax reliefs for another 3 years.
Increased funds availability for growth of SMEs has been made possible by enhancing the refinancing capability of SIDBI from the present Rs. 5000 crores to Rs. 10000 crores per year in Budget 2013. Further, these funds are being provided free of interest to the SMEs enabling increased investments in their business leading to enhanced profits and growth. Another good factor of Budget 2013 for SMEs is that they can list their businesses on Small and Medium Exchange without going for an Initial Public Offer from this year onwards. This is in addition to the option of listing through an IPO. This new provision can reap in additional benefits through prospective investors in SMEs by tapping capital market.
SMEs felt the need for guidance in technology awareness. To address this need, special provision has been made to set up technology development centres for offering guidance to SMEs by allocating extra funds in the Budget.
In electronics sector, customs duty is waived on plant & machinery procured for semi-conductor wafer fab manufacture which in turn can benefit SMEs linked with this sector. Textile and apparel industry received much attention. Technology up gradation fund scheme period has been extended to boost modernisation of power loom sector. Additional funds granted for Apparel Parks. Handloom weavers can obtain working capital and term loans at concessional interest rate of 6%. Handmade carpets and textile floor coverings are exempted from excise duty. But auto industry has received shocks like increase of excise duty from 27% to 30% on SUVs and increased import duty on super bikes and luxury cars from the current rates of 60% and 75% up to 100%.
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