New Delhi, Jan 2 (KNN) The recent announcement by the income tax department that past records of small businesses will not be reopened just because the turnover has increased during the current year, has emboldened the micro, small and medium enterprises (MSMEs) to ask for simplified norms for workers’ social security.

FISME, the leading federation of MSMEs has recently approached the Prime Minister to introduce a lump sum 10% social security charge for each worker and remove the burden of ESI contributions from MSMEs.

In his letter Dr. Sangam Kurade, President, FISME has requested Modi to minimise the social security burden on the MSMEs to a bearable level so that they can find it viable to comply them.

Earlier, FISME had approached the Prime Minister to advise the regulatory and tax authorities not to make additional demand for the previous years, just because there is an enhanced operation during the current year.

FISME had mentioned that the drive for cashless economy has brought a unique opportunity to both the Government and the vast unorganised sector to make all transactions transparent.

But, FISME mentioned, that if the Government do not adopt a liberal approach, the transparency will bring umpteen harassments from all regulators resulting disaster for the MSMEs and the country.

The circular by the Income tax to ‘forget the past’ brought real relief to the MSMEs,, who so far were forced to operate in the shadows due to  the fear of  the ‘inspectors’

The next barrier to ‘transparent’ business operations is the plethora of labour laws. It may be mentioned that today any enterprise has to bear about 32% additional burden over and above the workers’ wages towards provident fund, ESI etc. etc.

MSMEs who operates on razor thin margins and in any case has to pay a reasonable wage to the workers, simply find no wherewithal for the contributions towards the unrealistic social security charges.

These practical reasons lead to hiding of the actual number of workers and bribing of the inspectors which starts a vicious parallel economy.               

Along with the  vast majority of the entrepreneurs, FISME has demanded that if  Mr. Modi is really interested to banish the ‘Black Economy’ he should address the root cause and make transparent operation of business profitable.

With a lot of right kind of sounds emanating from the Government, the MSME fraternity is optimistic that in tandem with the ‘Less cash’ economy,  India will also be led towards a  ‘less taxed’ and ‘ least harassed’ business environment. (KNN/ DB)