`Small businesses prefer to remain informal as they fear taxes have to be paid’
Bengaluru: Union Finance Minister Nirmala Sitharaman has said reverse migration had started as a lot of people are coming back to establish business here.
According to her, reverse migration has started in which a lot of people, who have a global footprint, are finding businesses, professions and careers to be built in India.
“Ideally, India should be a country which is worth for our grandchildren to stay and live and lead their lives and contribute for the country rather than run away from here because opportunities, job satisfaction, career enhancement, are better there and not here,” the FM said during an interactive meet on ‘Economy and The Vision for ‘Amrit Kaal-2047.’
The event was organised by the Institute of Chartered Accountants Of India, Southern India Regional Council here in Bengaluru.
Sitharaman appealed to chartered accountants to bring more informal businesses on the formal side so that they can reap the benefits of the open world.
According to her, small businesses prefer to remain informal because they fear that they will have to pay taxes and taxmen can go after them.
Sitharaman said the fears were unfounded as allowing informal businesses to become formal businesses was not just about paying taxes. She pointed out that there was a likelihood of not paying tax at all even after coming on to the formal.
“You are coming on to the system because you can reap the benefits of the open big world into which a lot of people are coming on board,” the FM said.
She told the gathering that digital payments have made transactions easy with speed and access to newer markets, which is good for businesses.
The FM told chartered accountants that there was a need for a digital revolution even in small business.
She said there is a sense of fear among people that if they opt for formal business they will have to submit accounts every year and file returns each year.
“It means I am opening my systems up so that taxman is going to be after me – That is the fear which has to go out of people’s minds because the benefits that you reap once you come on to the system is far more than what you can account for now,” Sitharaman underlined.
