GST
scores big for sports goods makers in West UP; pharma feels the pain
On the outskirts of Meerut
thrives the sports goods manufacturing hub where work is in full swing.
While testing a leather
cricket ball, Lokesh Kumar Sharma, a senior partner of VATS Sports, praises the
goods and services tax (GST) regime brought in by the Bharatiya Janata Party
(BJP) government at the Centre. It has worked as an accelerator in our nation's
progress and streamlined the operations, says Sharma.
The view of Sharma is shared
by the owners of other micro, small, and medium enterprises (MSMEs) dealing
with sports goods manufacturing in the area.
A 5 per cent GST is now
levied on clothes. It is helping us since we had to bear the expense of buying
untaxed fabric, says Shivinder Sharma, chief executive officer of Active
Sports.
The BJP's manifesto, titled 'Modi
ki Guarantee 2024', promises to simplify GST compliances and laws, provide
digital credit, and streamline the tax portal for MSMEs.
Aditya Jain (name changed)
from GEM, another sports goods MSME in the area, praises the reduced paperwork
and travel for business processes thanks to GST. Previously, even to submit a
paper, we had to travel 15 km and give money to get the work done. Now, it's
better.
However, for pharmaceutical
distributors, it is different.
Pharma distributors in
Muzaffarnagar and Meerut are concerned about disrupted local trade and
unexpected tax notices.
We are being sent notices
for an error of Rs 2 from four years back, which was not the case earlier,
rues a small pharma distributor with the condition of anonymity.
According to Section 43B(h)
of the Income Tax Act, effective April 1, companies are supposed to pay MSMEs
within 45 days of the agreement. More than 182,000 complaints were filed by
small businesses to claim over Rs 42,000 crore, according to data from the MSME
Samadhaan Portal as on March 31.
The highest amount was to be
paid by state governments (Rs 5,886.9 crore), followed by central public sector
undertakings (PSUs) (Rs 5,074.4 crore), and proprietors (Rs 3,747.7 crore).
While Shivinder Sharma
praises the government for timely payments, Lokesh claims otherwise. We haven't
received payment from a state PSU for seven years."
Santosh (name changed) from
Quality Flavours Exports, a mint essential oils manufacturer in Moradabad, is
waiting for a payment whose deadline was extended to 90 days from 45 earlier.
A brass and iron
manufacturer flags the rising cost of raw materials. We are now thinking of
alternative work, he says.
Around 60 per cent of the
amount payable in disposed applications was settled by the Micro and Small
Enterprise Facilitation Council as on March 31. Central PSUs had settled the
highest amount, with Rs 1,075.2 crore, followed by state governments (Rs 786.5
crore), and proprietors (Rs 407.7 crore).
Lokesh highlights the
government's protection of MSMEs in their tenders and improved access to bank
loans. However, the Government e-Marketplace (GeM), an online platform to
procure directly from MSMEs, is a concern. Half of our business is dependent
on GeM. The portal has helped us get tenders from across India but the
re-auction bid affects our profitability.
According to a Rajya Sabha
reply, MSMEs contributed 29.1 per cent to the country's gross domestic product
in FY22. It was higher at 30.5 per cent in FY20.
www.business-standard.com
dt. 17.04.2024