JAIPUR: Difficulties for MSMEs are increasing by the day and the Union budget has failed to address the range of issues like higher IT rates, numerous compliances and surging cost of hiring professionals, said an industry representatives.
Sanjay Ghiya, an industry representative and practicing CA, said MSMEs are more disadvantaged than the corporates. “The current income tax regime is heavily stacked against the MSMEs. While new corporates pay 15% and old ones 22% as income tax, the same for LLPs and partnership firms goes up to 35%. That’s why it is impossible for MSMEs compete with corporates,” said Ghiya reacting to the central budget. Similarly, compliance is a huge burden, often saddles them with inefficiency and unwarranted financial liability.
“Nobody, not even the government can show a check list of compliances the MSMEs are required to fulfil. GST, IT and Companies Act compliance provisions are getting bulkier. Additionally, the changes are so frequent that it’s hard for the professionals like us to keep a track. There is not a single word in the budget in cutting down these compliances, which not only puts extra financial burden but also takes away time from core operations,” added Ghiya.
With regard to raising finance from friends, families and board directors, it’s an uphill task for the MSMEs.
“There are provisions, prohibitions and exemptions. It’s maze. The provisions are so complicated, it just does not happen when one needs funds,” said Ghiya.
He said the pandemic has put MSMEs in a tight corner and they needed at lease ease of doing business for recovery and revival.
“That’s why the Centre’e budget has completely failed to provide relief to the MSMEs which generate much larger employment opportunities than the big companies,” added Ghiya.
