ACMA welcomes thrust on manufacturing sector
ACMA has welcomed the thrust given in the Union Budget on the manufacturing sector, especially MSMEs. It has also expressed satisfaction at the thrust on infrastructure development, upliftment of the rural economy and significant outlay for promotion of the social sector, including education, skill development and healthcare.
Complimenting the Finance Minister, Mr. Pranab Mukherjee, Mr. Vinnie Mehta, ACMA Executive Director, said he has outlined concrete steps towards implementation of the Direct Tax Code (DTC) and GST.
MSMEs constitute over 70 per cent of ACMA’s membership, and access to capital has been one of the major constraints for the sector. The setting up of the Rs. 5,000-crore ‘India Opportunity Venture Fund’ will enable the sector to have access to the much-needed capital.
“We are also glad that the weighted deduction of 200% on expenditure on R&D has been extended for another 5 years, which will motivate the industry to focus on innovations and new product development. Further, shortage of skilled manpower has been an issue of significant concern to the industry; the introduction of weighted deduction of 150% on expenditure on skill development of employees will help in mitigating the concern”, Mr. Mehta said.
However, he said enhancement of excise duty would adversely impact the prices of vehicles and, in turn, their consumption. This is of concern to the auto component sector as it grows in tandem with the vehicle industry. Further, increase in customs duty on the ‘flat-rolled’ steel from 5 per cent to 7.5 per cent could unfavourably impact the sector as this is one of the key input materials for the industry.