Notification on MSME criterion leads to confusion
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Even as the central government has further revised the criterion for defining micro, small and medium enterprises (MSMEs), a disparity in the cabinet note and the gazette notification has left industrialists confused.
Under the new definition, industries having an investment into plant and machinery up to Rs50 crore and a turnover of Rs250 crore will now come under the MSME segment. The press release following the cabinet meet also said that for counting the limits, the turnover in respect of exports will not be considered. So, the Rs250 crore limit has to be only for domestic sales.
At present MSMEs having an investment up to Rs50 crore in land, plant and machinery have been included in the state’s PSI. The scheme provides full refund of the gross liability towards the state goods and service tax (SGST) for period ranging from seven to 10 years.
Under the current definition industries up to an investment only in plant and machinery up to Rs50 crore and a turnover of Rs250 crore will be treated as MSMEs.
To provide tax refund to the new industries covered under the definition the state government will have to amend its industrial policy.
The state government shells out around Rs4000 crore a year as SGST refund to all types of industries. The refund is available to large industries too but on the net SGST liability.
The state government will have to take a call considering its finances said a source. #casansaar (Source - Times of India)
Under the new definition, industries having an investment into plant and machinery up to Rs50 crore and a turnover of Rs250 crore will now come under the MSME segment. The press release following the cabinet meet also said that for counting the limits, the turnover in respect of exports will not be considered. So, the Rs250 crore limit has to be only for domestic sales.
At present MSMEs having an investment up to Rs50 crore in land, plant and machinery have been included in the state’s PSI. The scheme provides full refund of the gross liability towards the state goods and service tax (SGST) for period ranging from seven to 10 years.
Under the current definition industries up to an investment only in plant and machinery up to Rs50 crore and a turnover of Rs250 crore will be treated as MSMEs.
To provide tax refund to the new industries covered under the definition the state government will have to amend its industrial policy.
The state government shells out around Rs4000 crore a year as SGST refund to all types of industries. The refund is available to large industries too but on the net SGST liability.
The state government will have to take a call considering its finances said a source. #casansaar (Source - Times of India)
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