Excelsior Correspondent
JAMMU, Sept 27: Federation of Industries, Jammu, has said that existing Micro, Small and Medium Enterprises (MSME) units were on the verge of closure due to dilution of fiscal incentives in post UT regime.
The Federation particularly demanded Turnover Incentives on the basis of actual reimbursement claims without any capping and purchase preference lo local MSME units.
An urgent meeting of the Federation was held under the chairmanship of T S Reen, in the presence of Lalit Mahajan and Deepak Dhawan, Co-Chairmen and other Executive Committee Members, to discuss the uncertainty prevailing in the mind of existing working units due to dilution of fiscal Incentives in post GST regime resulting the future of around 6000 existing units working in Jammu province.
During the discussions, members raised serious concern towards the dilution of 50 percent in the budgetary allocation in post GST regime for existing Industry in comparison to fiscal incentives available before the implementation of GST Act in J&K.
“Industries Department of JK UT has notified the Turnover Incentive as handholding support to existing unit working as on 31-3-2021 with the initial budget of Rs 50 crores per annum with the assurance that the budget allocation shall be increased on the basis of claims received in each financial year. Claims have been received for the financial year 2021-22 from existing units amounting to Rs 206 crores but the Industries Department has now declined to enhance the budget to meet the additional requirement of Rs 156 crores resulting great resentment amongst the working MSMEs,” they explained.
The Federation further said that majority of existing local micro/small units have been established to cater to the requirements of the various Govt departments/agencies. “But after 5th August 2019, it has been made mandatory for the State Govt Departments to purchase goods through GeM Portal, resulting in the serious threat of closure being faced by the local MEME units supplying goods to Govt Departments as the price and purchase preference has been withdrawn which was applicable to MSME sector previously resulting in drastic decline in the sale graph of local MSME units,” it explained.
The Federation urged Lt Governor Manoj Sinha to constitute a high level committee with the participation of stake holders to resolve the issues in time bound manner by providing the fiscal incentives to existing units for their survival and employment generation.
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