The Finance Ministry is facilitating the growth and expansion considering that we depend upon MSME for employment. There is twin layered taxation impact on MSME – corporate tax and GST. To incentivize the small and medium industries, the corporate tax for new companies has been reduced to 15 percent. For the existing ones, it has been reduced to 22 percent. Now, the tax audit limit has been increased to Rs.5Crore provided cash transactions do not exceed 5 per cent of total transactions. Simplification of GST returns, Aadhaar verification, electronic invoicing have made GST compliances easier. The new startups having turnover up to Rs 25 crores had the tax benefit of getting 100 per cent of profits as a deduction for three consecutive years.
4 ways how current taxation system may ease compliance and boost ease of doing business for MSMEs
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