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On 1st February 2023, Union Finance Minister Nirmala Sitharaman had a slew of announcements that would impact the SME Sector stakeholders during her Union Budget presentation of 2023-24.

The Budget presented by the Finance Minister has provided much-needed oxygen to the small businesses that were badly affected by the Covid-induced crisis. One of the key efforts taken up by the government for SMEs as mentioned by the FM during her speech was the launch of a scheme that will introduce guaranteed revamped credit worth Rs 9000 crore. This measure is being taken to enable a collateral-free loan of Rs 2 lakh crore which would help small businesses to grow especially the ones that struggled to make ends meet during the Covid economic disruption. The scheme will become operative from 1st April 2023; the action was anticipated to increase the amount of money flowing to smaller businesses.

Other important steps include an increase in the Income-tax filing range. Earlier the limit was 2 crore but now the limit has been enhanced to Rs 3 Crore and 75 lakhs – enterprises with this turnover need not go for statutory auditing. This is a much needed booster dose that has been given by the Finance Minister for the MSME, the tax slab will definitely keep the sector afloat. Additionally, the Entity digilocker’s standardization of KYCs/common businesses and using PAN cards for all government related entities will assist in managing a business enterprise in an efficient manner as these actions will lower the cost of compliance.

The government in this budget allocation announced various schemes and fund allocations for the SME sector which will help the sector to bounce back, and in turn generate employment. There is mild dissatisfaction too, SME’s different industries were expecting reduction in GST tariffs, but it remains untouched. Overall, it did a fine job in striking a balance between creating opportunities for SMEs while also remaining within the limits of the budget deficit.

– Authored by Archana Bhati (Business Development Team) IndusGuru Network Partners