After Tamil Nadu, Odisha will be the second state in the country to offer fiscal and non-fiscal incentives to micro, small & medium enterprises (MSMEs) via the online mode.
The state government expects to provide all facilities for the sector mentioned under MSME Development Policy-2009 and Industrial Policy Resolution (IPR)-2007 by September this year.
“Various facilities like capital subsidy, input subsidy, VAT (Value Added Tax) subsidy will be made available to the MSME units online. The MSME department has already prepared an action plan for the same. The National Informatics Centre (NIC) will develop software for the purpose,” said a senior departmental official.
The draft MSME Development Policy envisages capital investment subsidy of 10 per cent of fixed capital investment, subject to an upper limit of Rs 8 lakh. However, SC, ST, physically challenged, women and technical entrepreneurs are entitled to capital investment subsidy of 12 per cent of fixed capital investment subject to a cap of Rs 10 lakh.
This is in addition to the benefits incorporated in IPR-2007. According to IPR, new MSMEs would be exempted from payment of entry tax on acquisition of plant and machinery for setting up of industrial units. Moreover, such units may be exempted from payment of entry tax on purchase of raw materials for a period of five years from the date of starting commercial production, subject to a ceiling of 100 per cent of fixed capital investment.
On VAT reimbursement, IPR says new MSME units will be eligible for reimbursement of 50 per cent of VAT paid for a period of five years from the date of starting commercial production, limited to 100 per cent of fixed capital investment. Moreover, new industrial units in priority sector would be eligible for 75 per cent of VAT for a period of five years from the date of beginning of commercial production limited to 100 per cent of fixed capital investment.
