NEW DELHI: The Central government has announced that all registered micro small and medium enterprises (MSMEs) would be permitted to avail all non-tax benefits for 3 years in lieu of one year, even after upward graduation in their category and consequent reclassification.
This notification has been issued by the Ministry of small and medium enterprises.
Advantages from various government programmes, like the public procurement policy and delayed payments, are examples of non-tax benefits.
The notification reads that an enterprise must continue to take advantage of all non-tax benefits of the category it was in before the reclassification for a period of three years from the date of such upward change in the event of an upward change in terms of investment in plant and machinery or equipment, turnover, or both.
According to government sources, this choice was made after careful consideration of the views of MSME stakeholders.
MSMEs had just been categorised by the government into the manufacturing and services sectors. Based on investments in equipment for the services sector and in manufacturing plant and machinery, they were further divided into micro, small, and medium firms.
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