Nirmala Sitharaman announces a series of measures to revive the economy

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Recently, The Union Finance Minister Nirmala Sitharaman announced a series of measures for economic revival which included a rollback of few key budget Announcements.

The FM claimed that India’s growth rate despite slowed down is still higher than many countries and the government has not lost momentum on reforms.

She spoke with a 32 slide presentation prepared by her ministry.

This comes in contrast to NITI Aayog chairman Rajiv Kumar who had described the liquidity crisis in the financial sector as “unprecedented”.

Key Announcements-For Investors
•Enhanced surcharge on FPIs and Surcharge on domestic investors in equity markets withdrawn.

•For opening Demat accounts and mutual funds investments- Aadhaar based KYC to be done.

•Enhance credit default swap option in consultations with RBI

•Government to bring offshore rupee market to domestic stock exchanges.

Key Announcements-For Industry
•CSR violations not to be treated as a criminal offense but a civil liability.

•GST refunds due MSMEs to be paid within 30 days and future refunds shall be paid within 60 days from application.

•Further simplification of the GST system.

Key Announcements-For Automotive Sector
•BS-IV vehicles purchased till March 2020 to remain operational for the entire period of registration.

•Government departments to replace old vehicles to boost demand.

•Additional 15% depreciation on all vehicles, to increase it to 30% acquired during the period from now till 31.03.20

•The government will consider new scrappage policy.

Key Announcements-For MSMEs
•Angle tax provision for start-ups and their investors withdrawn.

•One time settlement policy to be based on a checkbox approach for MSME loans to increase transparency.

•Laws shall be amended to ensure a single MSME definition.

Key Announcements-For Home and Auto loans
•Banks agreed to pass on the rate cuts to customers as announced by RBI thereby making Home and Auto loans Cheaper. Banks will launch repo rate linked loans.

•Online tracking of loan applications by customers of Retail, MSME, Housing, Vehicle, working Capital, limit enhancements, renewals, etc

•PSBs to ensure mandated return of loan documents within 15 days of loan closure.

Key Announcements- Income Tax
In order to address complaints of harassment on account of the issue of notices, summons, orders, etc. by certain income-tax authorities:

•On or after 1st October 2019 all notices, summons, orders, etc. by the income-tax authorities shall be issued through a centralized computer system and will contain a computer generated unique Document Identification Number.

•Any communication issued without computer-generated unique Document Identification Number shall be non est in law.

•All old notices to be decided by 1st October 2019 or uploaded again through the system

•From 1st October 2019 all notices to be disposed of within three months from the date of reply.

Key Announcements- For NBFCs
•Aadhaar based KYC allowed

•Prepayment notices issued to NBFCs to be monitored by Banks.

•Additional liquidity to support Housing Finance Companies by the National Housing Board increased to Rs 30,000 crore.

Other Key Announcements
•Government to recapitalize PSBs and to release Rs. 70000 crore upfront for this.

•The government intends resolution and not prosecution for businessmen and wealth creators.

•A task force to finalize the funding of Infra projects. Projects to be monitored actively to accelerate capital expenditure and investment.

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