Kolkata, April 18 -- The Confederation of West Bengal Trade Associations has issued an urgent call demanding the removal of a newly introduced subsection 43(b) in India's Income Tax Act related to payments made to Micro and Small Enterprises (MSEs).
The contentious provision, which came into force on April 1, 2024, restricts businesses from claiming tax deductions on payments to MSMEs unless made within 15 days of accepting supplies, or 45 days if a longer credit period was mutually agreed upon, reported TT.
However, the confederation argues the new rules run counter to existing business practices where credit cycles routinely exceed 45 days. This has made purchasing from MSMEs while claiming tax deductions an unviable proposition for m...