Budget 2012: Measures proposed for augmenting funds for SMEs

In order to augment funds for SMEs (Small and Medium Enterprises), Finance Minister Pranab Mukherjee, in the General Budget 2012-13 presented in Lok Sabha, has proposed to exempt capital gains tax on sale of a residential property, if the sale consideration is used for subscription in equity of a manufacturing SME company for purchase of new plant and machinery.

Further, considering the shortage of skilled manpower in the manufacture sector and in order to generate employment, Mukherjee has proposed to provide weighted deduction at the rate of 150 per cent of expenditure incurred on skill development in manufacturing sector in accordance with specified guidelines.

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Providing relief to a large number of SMEs, it has been proposed to raise the turnover limit for compulsory tax audit of accounts as well as for presumptive taxation from Rs 60 lakh to Rs 1 crore.