The central government has issued a notification and allowed all registered micro, small and medium enterprises (MSMEs) to continue to avail all non-tax benefits for three years, instead of one year earlier, in their respective categories even after re-classification, the MSME ministry said on Wednesday.
Re-classification includes growing from a ‘micro enterprise’ to a ‘small enterprise’ or a ‘small enterprise’ to a ‘medium business’.
Landmark Decision: MSMEs on upgradation and consequent reclassification, get non-tax benefits for a period of 3 years from the date of upward change #MSME #NSIC #KVIC #COIRBOARD #SCSTHUB#AmritMahotsav pic.twitter.com/Zy4t4Nz9La
— Ministry of MSME (@minmsme) October 18, 2022
“This decision has been taken after due deliberations with MSME stakeholders and is in line with the Aatmanirbhar Bharat Abhiyan. The Ministry of MSME, Government of India, has allowed those registered MSMEs to continue to avail of non-tax benefits for three years, instead of one year, in case of upward graduation in their category and consequent reclassification,” the ministry said.
It added that non-tax benefits include benefits of various schemes of the government, including public procurement policy and delayed payments, among others.
The ministry said the ministry has notified that 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.