RAI seeks announcement of National Retail Policy in Budget
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The Retailers Association of India (RAI) has recommended the government to announce the National Retail policy and allow retailers to register as MSME in the upcoming Union Budget.
In a statement, RAI noted that the the Indian retail sector was one of the worst impacted due to the pandemic and all efforts are required to boost the local economy and help revive the retail, saving millions of jobs.
RAI in its recommendation said that there is a need to expedite the formulation and implementation of the National Policy for Retail Trade.
"We believe that such a step would provide a substantial boost to the retail sector and facilitate ease of doing business. We recommend government to announce the policy in Budget 2021," RAI said.
RAI noted that retail trade is not classified under MSME and it does not come under the priority sector.
"Therefore, if a person is merely running a departmental store or a retail shop and retailing in products, not manufactured by him, he cannot obtain MSME registration," it said, urging the government to allow retailers to register as MSMEs.
It also made several suggestions on taxation. RAI said that GST laws do not allow for a refund where the tax rates on inputs services are higher than that on output and this leads to accumulation of credit with the company, blocking working capital.
It has recommended allowing a refund of accumulated input tax credit accrued on account of input services, capital goods.
Further, as per the current scenario, GST credit is leading to blocked working capital. It said that companies should be allowed to use GST deposit or credit for payment of basic import duty.
Speaking on the expectations from the Union Budget 2021-22, Kumar Rajagopalan, CEO, Retailers Association of India said: "The retail industry was almost squashed during the pandemic. It is slowly getting back on its knees with the opening up of the economy."
"To get this crawling industry back to its feet and start running, we believe that the budget should address two main things that will bring in Ease of Doing Business for retailers -- freedom from various procedural strangleholds and access to funds necessary for growth," he said.
