Finance Minister Nirmala Sitharaman on Wednesday announced Rs 3 lakh crore of collateral-free loans for small businesses, cut the tax rate for non-salary payments and provided liquidity to non-banking companies to help them tide over the disruptions caused by the lockdown.
Announcing the first set of components of the Rs 20 lakh crore COVID-19 economic stimulus package announced by the Prime Minister Narendra Modi, she said Rs 90,000 crore liquidity infusion will be made in electricity distribution companies to help them fight the current financial stress.
Also, dates for filing income tax returns and other assessments have been extended.
She said the rate of tax deducted at source (TDS) and tax collected at source (TCS) for non-salaried payments up to March 31, 2021, will be cut by 25 per cent.
The move will release Rs 50,000 crore in the system, she said.
The minister also extended by three months the government support to companies with less than 100 employees to meet retirement fund obligations.
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For all companies, the statutory obligation to pay 12 per cent of basic salary as employer's share to employee provident fund (EPF) contribution has been reduced to 10 per cent to boost their liquidity.
To boost construction, all government agencies will give up to 6-months extension to all contractors to complete construction, and goods and service contracts.
"Essentially this is to spur growth and to build a very self-reliant India," she said. "It addresses ease of doing business, compliance, and due diligence and the intention is also to build local brands."