Union Finance Minister and the government reduced the prices for digital trade transactions and ATM cash withdrawals to market online financial transactions at the time of the COVID-19 epidemic.
The finance minister of India, Nirmala Sitharaman said via a video conference that the deadline for submitting composition returns continues to be extended until June 30. She further said that the businesses with a turnover of fewer than five crores, no attention, no late charge, and no penalty will be charged. Companies with a turnover of above Rs 5 crore will not need to pay any late charge or penalty but might have to pay a 9% interest rate for the late filing of GST.
“I wish to underline that the date for choosing for composition scheme extended to 30 June 2020,” she said.
The minister announced the expansion of this deadline for filing income tax returns for the fiscal year 2018-19 until 30 June 2020 in a bid to offer relief amid the coronavirus crisis. Sitharaman also stated that the government decreased the interest rate on delayed TDS deposit to 9% from the preceding 18%.
Moreover, in a major aid for small and medium enterprises, the central government raised the threshold for default under the Insolvency and Bankruptcy Code (IBC) to Rs 1 crore from the present Rs 1 lakh. Addressing the press, the finance minister explained that the decision taken to prevent the tripping of insolvency proceedings against MSMEs.
Nirmala Sitharaman assured that this will prevent companies from being forced into bankruptcy proceedings in such force Majeure causes of default. On another statement, the Finance Minister said that debit cardholders, who draw cash from any bank ATM, can get it done free of charge for the subsequent 3 months.
“…so you might have a charge card from a financial institution, a specific bank, however, you will now be allowed, without additional fees, to draw money from any other bank’s ATM to your next 3 months,” the Finance Minister said.
Additionally, the minimum balance requirement fee has been withdrawn meaning that an account holder will be permitted to bring down accounts to almost zero with no banks charging a fee for that. At the moment this will apply for three weeks, the Minister informed.
For the trading community, bank fees will be reduced to digital commerce transactions for many trade finance consumers.
Sitharaman further said RBI and Finance Ministry is monitoring the volatility in financial markets and SEBI has come out with recommendations to make sure that transactions appropriately tracked.
The decision comes firms throughout the nation severely hit, and likely to face financial losses as a result of coronavirus lockdown.
The Government may come up with an economical package to prevent the COVID-19 Pandemic from causing major harm to the economy. The finance minister stated as a first step they were fixing the compliance-related problems, and an economic package covering issues concern the industry announced separately later.
“The economic package will be announced shortly,” Nirmala Sitharaman said while announcing a set of compliance-related issues, such as the expansion of dates for filing IT and GST returns.
Earlier in the afternoon that the FM gave a sign about the package in a tweet.
“Even as we’re Readying an economic package to help us throughout the corona lockdown (on priority, to be announced shortly) I’ll handle the press at 2 pm now, especially on statutory and regulatory compliance issues via video conference,” said the tweet of the finance ministry.
The government has provided a large relief to the corporate businesses on compliance-related issues especially related to the incorporation of businesses and qualifications of directors. As per announcements produced from the Sitharman, a company has been given six months to file a declaration of commencement of business.
“Under Section 149 of The Companies Act., noncompliance of the rule has been treated as a breach. It will not be treated as a violation,” the Finance Minister said.
The government has decided to provide more flexibility to firms over the requirement to create a deposit reserve from 20% of their deposits maturing in FY21 from April 30. This requirement can be met by June 30.
The companies were given time until June 30 to spend 15% of debentures maturing during a year in specified instruments. The date of compliance with the earlier was April, 30.
Indian Economy that slowed down before the coronavirus outbreak is responsible for a more difficult period in the coming months with the businesses finance ministry and the RBI have obtained several measures to guarantee liquidity in the system remains intact. But the industry has called for more stimulus to fight depression-like conditions setting in the economy.