New Delhi: Asserting that the Budget provides a ‘big relief’ to the MSME sector, Union Minister Kalraj Mishra today said announcements like the lowering of income tax for smaller firms and doubling the lending target under MUDRA Yojana will benefit small entrepreneurs in the country.

Observing that smaller firms had “faced difficulties” post demonetisation, Mishra told PTI that the move to slash income tax for firms having turnover up to Rs 50 crore will provide a “big relief to the MSME sector”.

Mishra said the announcement to double the lending target to Rs 2.44 lakh crore under the Pradhan Mantri Mudra Yojana for 2017-18 will immensely benefit the small entrepreneurs.

The minister said the government’s thrust on skilling youth and enhancing their employability potential will provide a skilled workforce to the micro, small and medium enterprises.

Finance Minister Arun Jaitley today reduced the income tax for smaller companies with annual turnover up to Rs 50 crore to 25 per cent, to make MSME companies more viable and also to encourage firms to migrate to company format.

Unveiling the budgetary proposals for 2017-18, Jaitley said: “As per the data of assessment year 2015-16, there are 6.94 lakh companies filing returns, out of which 6.67 lakh companies fall in this category. Therefore percentage wise, the 96 per cent companies will get the benefit of this lower taxation”.

Observing that the Pradhan Mantri Mudra Yojana has contributed significantly to funding the unfunded and the underfunded, Jaitley said: “Last year, the target of Rs 1.22 lakh crores was exceeded. For 2017-18, I propose to double the lending target of 2015-16 and set it at Rs 2.44 lakh crores. Priority will be given to Dalits, Tribals, Backward Classes, Minorities and Women”.

Source: The Economic Times