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“Budget may not increase woes of small industries”

PUDUCHERRY: The Association of Small Industries of Puducherry has said that though the Union budget was “populist” it would not “heighten the woes” of the small enterprises.

The Union Finance Minister had tried his best to present a populist budget that would not, at least, increase the woes of the productive sectors of the country, secretary of the association K. Parthasarathy said in a release on Saturday.

Welcoming the decision to reduce Credit Guarantee Fee from 1.5 per cent to 1 per cent and annual service charges from three-fourth to half-a-per cent in the matter of collateral free loans granted by banks to micro units for funds up to Rs. 5 lakh, Mr. Parthasarathy said the decision would help small enterprises.

On the decision to raise the income tax exemption limit, he said the measure, besides helping individuals to save more money, would benefit small industry promoters. He also favoured the hike in Service Tax exemption limit from Rs.8 lakh to Rs. 10 lakh as it would give marginal relief to small players in the industrial sector.

However, he said the Union Finance Minister had failed to increase the CENVAT exemption limit to Rs. 2 crore and to give Income Tax holiday for micro units for a period of five years in backward areas and three years in other places. The Minister had also failed to give exemption to small units from Service Tax on Business Auxiliary Services and micro units from Fringe Benefit Tax, Mr. Parthasarathy said.

The Union and State governments should take “bold steps” to help the small and micro units thrive, he said .

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