Finance Minister Nirmala Sitharaman announced on Tuesday that the last date for filing GST returns for March, April and May has been extended to June 30. The previous date for filing of GST returns was March 31, 2020. The deadline for composition returns on GST has been also been extended to June 30, 2020.

The FM made these announcements during her address to the media on measures to tackle the economic impact of coronavirus. She added that no different staggering dates will be followed while filing GST returns for March, April and May.

Sitharaman also announced that companies with less than Rs 5 crore turnover won't be charged interest or penalty for the late filing of GST. Bigger companies will have have to pay the interest amount at 9 per cent for delayed filing of GST, but no late fee or penalty will be levied.

The last date for opting for the compensation scheme has been extended to June 30, 2020.

The FM has also announced that the deadline for filing income tax returns for Financial Year 2018-2019 has been extended to June 31, 2020.

The deadline for Aadhar-PAN linking has been extended to June 30. The interest charged on delayed deposits of TDS has been lowered from 12 per cent to 9 per cent and will be charged till June 2020.

In her address, the FM also said that customs clearance has been made an essential service and hence will continue to operate 24/7 till June 30, 2020. Vivad se Vishwas tax dispute resolution scheme has been extended by three months to June. Those willing to utilise the scheme will not have to pay a 10 per cent additional charge.

According to the FMs announcements, debit card holders can now withdraw cash from any ATM without being charged a fee, even if the ATM is not of the bank the cardholder has their account in. The minimum balance charges have also been removed on all bank accounts for three months.

Several banks have revised their operating times and suspended non-essential banking services because of the rising novel coronavirus (COVID-19) cases in India. Banking services like passbook updates, counter cheque collections have been restricted as the banks promote social distancing.

Many banks have also requested users to avoid visits to branches and go digital with mobile banking, internet banking, UPI/QR payments.

Private players - IndusInd Bank, HDFC Bank and ICICI Bank - will now remain open for four hours and will continue to provide essential services like cash deposits, cash withdrawals, government transactions and clearing of cheques. Banks have instructed their employees to stay at home in case they exhibit COVID-19 symptoms.

HDFC Bank

HDFC Bank has suspended services like passbook updates and foreign currency purchases. While the counter cheques collection service is halted, bank customers can still deposit cheques in the cheque-drop boxes. HDFC Bank has changed its operation timings from 10.00 am to 2.00 pm until March 31.

SBI

India's largest bank SBI has not changed its working hours but, has barred services like account opening, cash withdrawals, passbook printing, currency exchange services.

Canara Bank

Canara Bank has also made no revisions in the work timings but, has reduced non-essential services -- passbook printing, currency exchange. The bank has also reportedly asked its staff to not have over 15 per cent of its total working strength in the office.

ICICI Bank

ICICI Bank has reduced its operating time from 10 am to 2 pm till March 31 but hasn't suspended any banking services so far.

PNB

Punjab National Bank has also not changed its working hours or services.

European Central Bank (ECB) has reduced the capital buffer requirement for banks to allow them to lend more in these coronavirus-affected times. Chinese Central Bank has provided refinancing support to Covid-19 impacted sectors as well as lower lending rates for small businesses. Central Bank of Australia, the Philippines Central Bank and many others are relaxing rules for banking sector to help the industry.

While interest rate cut and bond buying to create additional liquidity is uniformly followed by all the central banks, the banking industry needs specific measures to help select industries fight the impact of the Covid-19.

In India, the total exposure of banks to Covid-19 hit sectors is in excess of Rs 11 lakh crore. The government, RBI, banks and the industry are in discussion to decide what best can be done given the current state of banks and the industry. Especially for sectors such as hospitality, tourism, trade, transportation, aviation which have been impacted directly. Micro, small and medium enterprises (MSMEs) are also impacted because of shortage of funds and the size of their businesses.

As per RBI's sectoral data, the loan outstanding against the trade (import and export industries) is the highest at Rs 5.19 lakh crore followed by MSMEs, where the outstanding loans are Rs 4.73 lakh crore. Transports operators owe Rs 1.41 lakh crore, and tourism, hotel and restaurants (Rs 45,394 crore).

The government, RBI, banks and industry representatives are already in discussion to provide relief to Covid-19 hit sectors. In fact, a relaxation in 90 days default norms before declaring them as NPAs would give relief to both the industry and the banks. The industry would continue to enjoy credit facility while the banks will not be required to make any NPA provisioning from their profits.

The current NPA at over 9.1 per cent ( Rs 9.36 lakh crore ) of total advances are already at an alarming level. In fact, the NPA provisioning pressure and the subsequent delay in resolution of these assets has been putting capital pressure on banks. Banks need capital for provisioning as well as growth to survive in the market.

The PM has already set up an economic task force which has to decide on an economic package for industries after talking to all the stakeholders. The Indian Banks Association (IBA), a representative body for banks,  is also working on sending its recommendations to the RBI for certain relaxation.

Experts suggest the RBI should look at broader relaxation from capital requirements like what the global central banks are doing rather than relaxing the NPA asset classification norms for select sectors.  

So far , the RBI has announced a long term repo auction of Rs 1 lakh crore to create liquidity for banks, which will help them to lend more. Similarly , the RBI has also announced buyback of bonds up to Rs 10,000 crore.

Finance Minister Nirmala Sitharaman today met Minister for Animal Husbandry, Dairy and Fisheries Giriraj Singh to assess the economic impact of COVID-19. During the meeting, Finance Secretary, Secretary DEA, Secretary (AHD) and Secretary (Fisheries) were also present. The FM is also scheduled to meet ministers of civil aviation, MSMEs and tourism today.

The special COVID-19 economic task force announced by Prime Minister Narendra Modi on Thursday will likely work on an economic package for the sectors most affected by the coronavirus outbreak, including informal sectors. He said the task force would ensure that all necessary steps were taken to reduce the economic difficulties arising out of the crisis. He also urged the FM-led task force to implement them effectively.

He said this was a difficult time and the need of the hour was to take stock of economic interests of everyone. "I request the business world and high-income groups to that, if possible, keep in mind the economic interests of those who serve you," said the PM.

As per experts, the task force will have to take drastic steps like relaxation in NPA (non-performing assets) norms, deferral of tax payments and the announcement of income support to the people working in the unorganised sector.

Notably, travel, tourism and hotel industries are some of the worst-affected sectors due to travel bans, social distancing and suspension of business activities. While other related sectors like fuel minerals, electricity and water and rubber, plastic, coke and petroleum products, etc are also likely to be impacted adversely.

Coronavirus outbreak has disrupted the global economy, and countries, trade blocs are taking fiscal measures to overcome the crisis. While India is yet to come up with a rescue package in wake of coronavirus crisis, major economies of the world have announced billions of dollars worth bailout packages to offset losses due to the COVID-19's outbreak.

The US alone has set aside over $1 trillion in a bid to protect the economy from COVID-19. UK, Switzerland, China, Sweden, Austria, and Japan, have also taken fiscal measures, including offering support to local businesses.

As many countries afflicted by the deadly coronavirus have stepped up efforts to save economy and businesses in the fallout of the virtual lockdown, travel bans and suspension of business activities, the demand for tax cuts, relaxed NPA norms and cash transfers has grown in India.

The benchmark indices Sensex and Nifty crashed around one-third from their peaks in January this year, while the rupee hit Rs 75 a dollar, reflecting gloom and doom in the economy post the outbreak of coronavirus.

Given the situation, like many countries in the West, India needs to come out with an economic assistance or a rescue package to support the economy. There are strong speculations that Prime Minister Narendra Modi might announce an economic package tonight in his address to the nation.

Economists suggest that the government should take steps on both monetary and fiscal front as well as work in co-ordination with the state to tide over the situation. Key announcements expected are rate cuts and relaxation in NPA norms for sectors impacted by the coronavirus outbreak.

"Just like any other country, we need to support our economy. Cut interest rates, do an intervention in the market to buy gilts, PSU bonds and high credit corporate bonds. Provide loan subvention to industry which needs support," says Nilesh Shah, MD, Kotak AMC.

"Banks should be allowed to consider a temporary restructuring of loan terms for the most-affected borrowers," says Sachchinand Shukla, chief economist, Mahindra Group.

Shukla also says fiscal response will require addressing families' and firms' balance sheets. He is in favour of targeted measures for directly affected sectors such as aviation, retail and leisure etc.

The steps directly helping the affected sectors include (GST) rate cuts and deferral of tax payments.

"In days to come, the struggling sectors particularly travel, hotel, food industry will certainly approach the GST Council as well as the government to request a reduction in GST rates to enable them to get over the loss of business. We hope the GST Council looks into the aforesaid on a priority basis and announce a suo moto reduction in GST rates for the impacted sectors including travel, hotel and food industry," says Pritam Mahure, a Pune-based chartered accountant.

Experts also demand special packages for individuals, especially, those working in the unorganised sector. An SBI research report says that the increased excise revenue from oil should not be used for bridging the fiscal gap and pleasing the markets, rather it must be used as a fiscal package for income support to the people working in the unorganised sector who are already facing the brunt of loss of jobs.  

Sachchinand Shukla of Mahindra Group says government should leave more money into the hands of people through fuel price cuts, subsidies, free diagnostics and curative policies for those quarantined.

Shah of Kotak AMC says tax cuts and direct transfer schemes such as Pradhan Mantri Kisan Sanman Yojna will support consumers/daily wage earners who have been impacted by the coronavirus-led slowdown.