FM Key Announcements: Relief Measures Amidst Corona Scare

India is fighting back against the ‘demon’ of the COVID–19!

Several measures are being taken by the authorities to ‘break the vicious chain’ of this Corona virus. Needless to say that our daily lives have been disrupted as the country has been put under lockdown till 14th April.

In this ‘test of time’, companies are forced to adopt contingency plans and focus more on their current business exigencies. Significant concerns related to business continuity are being raised from all quarters.

However, it’s heartening to see the Indian Government coming out to extend its helping hand towards the taxpayers and businesses disrupted by the ‘claws’ of this pandemic. While addressing the Media, the Finance Minister has announced a slew of timely measures to extend the deadlines for regulatory and statutory compliances.

Key Takeaways–

1. Tax reliefs

• The last date for filing Income Tax Returns for the Financial Year 2018-19 has been extended till June 30th,
• The deadline for the mandatory linking of Aadhaar and PAN is now 30th June, instead of 31st
• The rate of interest payable against the delayed deposit of TDS is now reduced to 9% from 18%
• The deadline for “Vivaad se Vishwaas”, the Tax dispute resolution scheme, has been extended by another 3 months, till June 30th. Also, the taxpayers availing this scheme will not need to pay the additional 10% interest on the principal as stated earlier
• The timelines for all other compliances under the IT Act, Benami Transaction Act, the Wealth Tax Act, and Black Money Act have been extended till June 30

2. Financial Services

• Debit cardholders can now withdraw cash from the ATM of any bank, free of charge, for the next 3 months. This will ease the burden on people in case they need urgent cash, without overcrowding the bank branches.
• No charge will be levied on customers if they fail to fulfil the minimum balance criteria by the banks.
• Digital charges on trade transactions have been reduced

3. Relief related to GST

• Last date for filing GST returns for March, April and May (along with composition returns) has been extended to June 30th
• No late fee, penalty, and interest have been prescribed against late filing by companies with a turnover of less than Rs 5 Cr. The interest on late payment for companies having a turnover of more than Rs 5 Cr is kept at 9%

4. Relief for companies

• For the MCA 21 registry, a moratorium is being issued to waive additional payment for late filing till 30th September
• The mandatory requirement for the companies to hold board meetings has been relaxed for the next 2 quarters.
• Newly incorporated companies will get an additional time period of 6 months for filing the mandatory declaration of business commencement
• In case a company director fails to comply with the minimum residency criterion of 182 days, the same will no longer be treated as a violation.

5. Relief related to customs

• The last date for the ‘Sabka Vishwaas Scheme’ has been extended till 30th June from the existing 31st March
• The customs clearance team will work round the clock till 30th June

6. Measures related to Insolvency & Bankruptcy code

• The default threshold limit under the Insolvency & Bankruptcy Code (IBC) has been increased to Rs 1 Crore from the existing Rs 1 lakh.
• If the current situation triggered by the Corona Virus scare prevails beyond April, there is a possibility of suspending the provisions of Sec 7, 9 and 10 if the IBC.

The FM also announced that the above-mentioned moves are as per the recommendations of the special Economic Task Force set up by the Government to combat the Corona Virus situation. While dismissing any fears of an economic emergency as yet, the FM said that many economic relief packages are in the pipeline and will be implemented soon to thwart the impact of this epidemic on the Indian economy. She asked people not to panic as the Government is closely monitoring the market situation every day.

All these are welcome measures. And could not have come at a better time for the businesses troubled already by severe disruptions from the ‘COVID-19 bug’ (Corona Virus disease). More such measures are expected to help businesses ‘stand tall’ amidst an unprecedented situation marked by restrictions on movement.