• UGI USER
  • May 06, 2024
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MSMES IMPACTED BY NEW TAX CLAUSE, FACING CANCELLATIONS AND COMPETITION

Why in the news?

MSMEs face challenges due to new tax clauses, leading to cancellations, competition, and calls for reevaluation of payment timelines.

source:slideshare

Key Points:Criticism and Impact

  • Punjab BJP General Secretary Rakesh Rathore condemned Channi’s remarks, citing disrespect for security forces.
  • Competition between registered and unregistered MSMEs emerged, with smaller entities deregistering to survive.
  • Tamil Nadu and Puducherry Chartered Accountants’ Association Secretary highlighted the pressure on MSMEs to maintain competitiveness.
What is Section 43B(h) of the IT Act?

●   Section 43B(h) added to IT Act by Finance Act 2023.

●   Requires timely payments to UDYAN-registered MSMEs for deduction.

●   Failure to pay on time increases tax liability.

●   Applies to transactions with MSMEs under MSMED Act.

●   Promotes timely settlements, supports MSMEs’ economic growth.