Coronavirus: Govt announces immediate tax refunds for SMEs, individuals to beat cash crunch
As only businesses involved in essential services can operate during the coronavirus lockdown, means other businesses, especially SMEs are facing the brunt.
The government of India has announced that it will issue all pending income tax refunds up to Rs 5 lakh and GST custom refunds with immediate effect. This was made to provide relief to small and medium businesses (SMBs) and individuals suffering from cash crunch during the lockdown imposed to curb the spread of the coronavirus.
In a press statement, the Finance Ministry said,
In the context of the COVID-19 situation and with a view to provide immediate relief to the business entities and individuals, it has been decided to issue all the pending income-tax refunds up to Rs 5 lakh, immediately. This would benefit around 14 lakh taxpayers. It has also been decided to issue all pending GST and custom refunds, which would provide benefit to around one lakh business entities, including MSME.
Many individuals are facing cash crunch at the moment, as their salaries are getting cut or delayed, or are part of layoffs happening due to crash in the businesses because of the coronavirus impact.
It is worth noting that shops and businesses who are involved in essential services such as groceries and medicine supply can only operate at this time, which means other businesses, especially small and medium enterprises are facing the brunt of the lockdown in a big way.
The finance ministry said that a total refund granted will be approximately Rs 18,000 crore.
Amid growing concerns over the coronavirus pandemic, Finance Minister Nirmala Sitharaman last month announced a slew of financial relief measures in the Budget session to help deal with the pandemic-induced economic crisis in the country.
In a press conference, Sitharaman touched upon the taxpayers' concerns surrounding Income Tax returns, compliance, and the deadline related to GST, IBT related matters, bank related compliances etc, and said that the Narendra Modi-led government is working on a financial relief package to help people in the light of the COVID-19 pandemic.
(Edited by Saheli Sen Gupta)