Centre allows MSMEs to avail non-tax benefits for three years

NEW DELHI: The Centre has notified that all registered micro small and medium enterprises (MSMEs) would be allowed to avail all non-tax benefits for three years instead of one year, even after an upward graduation in their category and consequent reclassification.

This notification has been issued by the Ministry of MSME.

Non-tax benefits include benefits of various schemes of the government like public procurement policy and delayed payments among others.

In case of an upward change in terms of investment in plant and machinery or equipment or turnover or both and consequent re-classification, an enterprise shall continue to avail of all non-tax benefits of the category it was in before the re-classification, for a period of three years from the date of such upward change, the notification said.

This decision was taken after due deliberations with MSME stakeholders, official sources said.

The government had recently reclassified MSMEs into manufacturing and services sectors.

These were further classified into micro, small and medium enterprises based on investment in plant and machinery for manufacturing and investment into equipment in respect of services sector.