Preparations are underway to change the Income Tax law related to making payment to MSMEs within 45 days.
Preparations are underway to change the Income Tax law related to making payment to MSMEs within 45 days. CNBC Awaaz has received information from sources that the government is preparing to amend the MSME Act 2006, so that the payment period can be increased from 45 days to 90 days. At the same time, the Finance Ministry can make changes in the existing income tax law. In the budget of 2023-24, the government had made a provision for payment to MSMEs and small businessmen in 45 days. If companies default by 45 days, their tax increases. But instead of helping MSMEs, this created a new problem.
Companies stopped taking work from MSMEs:
To avoid this rule, companies stopped taking work from registered MSMEs. RK Gaur, General Secretary of Federation of All India Trade Board, says, "If big traders want to purchase from micro-small, then tell them that we will do business with you only when you surrender the registration of MSMEs." And it is known throughout the country, it is also in the records of the government that many people have got the registrations of their MSMEs cancelled.
MSMEs protested against this rule and went to court. Exporters are also facing a lot of problems due to the law of payment within 45 days. The matter of payment to MSMEs within 45 days also reached the Supreme Court. However, the Supreme Court has refused to hear this matter at present
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