Finance Minister Nirmala Sitharaman's Press Meet: Highlights

Apart from relief measures for micro, small and medium enterprises (MSMEs), covered by Hans India in earlier reports, Union Finance Minister Nirmala Sitharaman announced a slew of other measures for various sectors. Here are some of the highlights from other areas:

Rs.2500 crore EPF support for business and workers for three more months.

• • Under Pradhan Mantri Garib Kalyan Package, Payment of 12% by the employer and 12% contribution by the employee was made into EPF accounts of eligible establishments.
• • This was provided for salary months of March, April and May 2020 earlier and will be extended by another three months through the salary months of June, July and August 2020.
• • This is aimed at providing liquidity relief of Rs.2500 crores to 3.67 lakh establishments and will cover 72.22 lakh employees.

Rs. 6750 Crore liquidity support - EPF Contribution Slashed For Business and Employee for 3 Months

• Statutory PF contribution of both employer and employee will be reduced to 10% from the existing 12% each for all establishments covered by EPFO for the next three months to give relief to employers in payment of provident fund dues and to help employees take home more salary.

• CPSEs and PSUs Will however continue to contribute 12% as employer contribution.

• This scheme will be applicable for workers who are not eligible for 24% EPF support under PM Garib Kalyan package and its extension.

• The measure will provide relief to about 6.5 establishments covered under EPFO and nearly 4.3 crore such employees. It will also provide liquidity of Rs. 6750 crore to employers and employees over three months.

Rs. 50,000 crores liquidity Through TDS/TCS Rate Reduction

• To provide more funds to taxpayers the rates of Tax Deduction at Source (TDS) for non-salaried specific payments made to residents and rates of Tax Collection at Source (TCS) for specified receipts will be reduced by 25% of the existing rates.

• Payment for contract, professional fees, interest, rent, dividend, commission, brokerage, etc., shall be eligible for this reduced rate of TDS.

• This reduction shall be applicable for the remaining part of the financial year 2020-21 to March 31, 2021.

Due Date of IT for Financial Year 2019-20 Extended

• The due date of all income tax returns for the financial year 2019-20 has been extended from 31st July 2020 and 31st October 2020 to 30th November 2020.

• Tax audit has been extended from 30th September 2020 to 31st October 2020.

• All pending refunds to charitable trust and non-corporate businesses and professionals including proprietorship, partnership, LLP and cooperatives will be issued immediately.

Extension of registration and completion date of real estate projects under RERA

• Union Ministry of Housing and Urban Affairs will advise states and Union Territories and their regulatory authorities to treat COVID-19 as an event of Force Majeure under RERA.

• They will extend the registration and completion date suo moto by six months for all registered projects expiring on or after 25th March 2 020 without individual applications.

• Regulatory authorities may extend this for another period of up to 3 months, if required.

• These measures are aimed at providing relief to real estate developers and ensure completion of projects so that homebuyers are able to get delivery of their booked houses with fresh timelines.

Rs. 90,000 Crore Liquidity Injection For DISCOMs

• • DISCOM payables to power generation and transmission companies stands currently at Rs.94,000 crore.
• • Revenues of many of the power distribution companies have declined sharply.
• • PFCs/REC to infuse liquidity of Rs.90,000 Crore to DISCOMs against receivables.
• • Loans will be given against state guarantees for exclusive purpose of discharging liabilities of the Discoms to Gencos.
• • Central Public Sector Generation companies will give rebate to Discoms which will in turn be passed on to the final consumers or industries.

Rs. 30,000 Crore Special Liquidity Scheme For NBFCs/HFCs/MFIs

• The government will invest in both primary and secondary market transactions in investment-grade debt paper of NBFCs/HFCs/MFIs. This will supplement RBI and measures of the central government to augment liquidity.

• Securities will be fully guaranteed by the government of India and the measure will provide the necessary liquidity support and create confidence in the market.

Rs. 45,000 Crore Partial Credit Guarantee Scheme 2.0 For NBFCs

• • Existing PCGS scheme will be extended to cover borrowing such as primary issuance of Bonds/CPs (liability side of balance sheets) of such entities.
• • First 20% of loss will be borne by the guarantor which is, in this case, the government of India.
• • AA paper and below including unrated paper will be eligible for investment and this is especially relevant for many MFIs.
• • The scheme will result in the liquidity of Rs.45,000 crores.