New Delhi, Feb 1 (KNN) With the Prime Minister Narendra Modi led NDA government presenting its last full budget before the Lok Sabha Polls of 2019, different sectors including the Micro, Small and Medium Enterprises (MSMEs) are eyeing at the document with hope.

Here is a quick recap of the wishlist:

Cut in Corporate Tax, investment allowance on capex

Representing the Micro, Small and Medium Enterprises (MSMEs) sector, Federation of Indian Micro and Small & Medium Enterprises (FISME) - a national body of MSMEs comprising of over 740 associations, in its memorandum urged the government to consider investment allowance on capex without any lower threshold limit.

Highlighting the MSME sector being labour intensive, FISME raised that the government must encourage Increase in internal accruals in MSMEs, which will further enhance their employment capacity through expansion etc.

With regard to corporate tax, C S Goel, Vice President, Federation of Indian Micro and Small and Medium Enterprises (FISME) emphasized that it is high time for the government to consider reducing corporate tax to 25 per cent.

Along with the cut, the government should consider providing investment allowance.

Lowering tax rate and increasing incentives for textile MSMEs

The Confederation of Indian Textile Industry in its memorandum submitted to the Finance Minister Arun Jaitley, demanded redressal of GST issues, lowering of tax rate and incentives. Most of these issues related to facilitating the manufacturing and exports.

The major demands raised by the association include refund of input tax credit at fabric stage as it is consumed by general public refund of excess or accumulated input tax credit (ITC) of job workers as all work is done by them and this would help industry to become more competitive.  

Reduction on gold import duty

Eyeing at potential boost for the sector, gems and jewellery industry the government to reduce the import duty on gold to 4 per cent and also address issues under the GST regime in the coming Budget 2018.

Also economists are looking at the upcoming budget to be able to provide the much needed boost to the economy in total and MSME sector in specific.

Handholding, credit to MSMEs

Manika Premsingh, Economist and Founder of Orbis Economics said that MSMEs have faced a number of challenges in the recent past. First, industrial growth has been quite slow, which has hit small entrepreneurs hardest. Second, the GST implementation had a few hiccups, which could have cost them some business. Third, costs are rising from an increase in WPI inflation overtime.

Therefore, it is essential that MSMEs, who form the backbone of the economy, be encouraged. Since India has a large population concentrated in the working age group, it is essential that enough job creation take place and MSMEs are well poised to do that.

The Union Budget 2018 is to be tabled in the parliament from today. (KNN/DA)