This is what Indian SMEs are expecting from General Elections 2019
As SMEs are striving for success, so are their challenges. Demonetization and GST, introduced by the government, had brought plenty of opportunities and setbacks alike.
However, SMEs have a lot of expectations from General Elections 2019 and the newly elected government thereafter. In this article, we highlight some of them.
1. Better financial schemes for SMEs
Every business looks out for the convenient option of funding at different points of time. There are various government schemes for funding SMEs such as MUDRA and MSME loan in 59 minutes. These are targeted towards providing cost-effective financial solutions to SMEs.
Though these schemes have done their bit to solve financial challenges bothering SMEs, there’s a lot to be done.Therefore, from the new Government, post elections, SMEs are anticipating more industry-friendly financial policies which will help them grow in the long run.
2. Beneficial GST rates
Introduction of GST had many benefits on offer for SMEs like ease of tax compliance and removal of multiple taxes. However, the newly introduced indirect tax system still has some bottlenecks related to tax filing and the rates.
Hence, SMEs are expecting the newly elected government to formulate better and beneficial GST rates which will benefit them in the long run. Though the minimum threshold for enrolling in GST has been revised of late, yet there’s a general feeling on tweaking this threshold to bring in more firms under GST.
3. Exemption fromAngel tax
The Indian government charges 30% angel tax on start-ups, funded by angel investors. SMEs expect an exemption from angel tax because of the high penalty charged by the Income Tax department one fails to pay this tax, which takes a toll on their finances.
SMEs fear that such penalties may prevent investors from investing in their ideas. Hence, there’s a general consensus among SMEs that the new government post-election will eliminate this tax
4. Improving infrastructure for digitalisation
The government has created employment opportunities with its Digital India and Making in Indiaschemes. Many start-ups were digitised, and employment was accelerated. However, rural areas of India still demand better infrastructure to promote the digitalisation of transactions.
Promoting digitalisation by incentivising digital payments and installing more wi-fi hotspots in rural and semi-urban areas will enable SMEs to set up operations in smaller towns which will indirectly lead to bridging the urban-rural divide. At the same time, it will have a direct positive impact on bottom line revenues.
The final word
There’s a lot of anticipation from SMEs from the newly-elected government post General Elections. As growth drivers of the Indian economy, it’s only prudent that the government fulfils the expectation of SMEs and look to dig deep into their and come up with robust and concrete solutions.
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