While small, medium and micro enterprises (SMMEs) will be keeping a close eye on today’s budget speech, the news is already promising following President Cyril Ramaphosa’s maiden State-of-the-Nation address (SONA).
Image Supplied by Innovative Accounting Solutions
Stefani du Preez, Director of Innovative Accounting Solutions, says the reduction of regulatory barriers is great news for small businesses, which have had to negotiate a difficult economic environment, exacerbated by political uncertainty and a cumbersome regulatory framework.
“A 2017 State of Small Business report by Xero shows that 62% of South Africa’s small business owners have noticed a reduction in consumer demand this year. A further 68% say their biggest business challenge is economic volatility.
“As a major contributor to economic growth in South Africa, the SMME sector is particularly keen to hear how government intends to relieve the pressure on small businesses and promote ease of conducting business in the country,” she says.
Some of the issues SMME owners will be looking for clarity on during this year’s budget speech include:
Small business owners need clarity on the implications of the current budget shortfall and how it will affect tax for individuals and companies.
“Government would do well to tax luxury goods rather than put additional pressure on small business owners,” suggests du Preez.
Many small businesses are struggling to survive – some have even had to close their doors – as a result of late payment or non-payment by government. SMMEs will be keen to hear what measures government will put into place to ensure payments are made timeously.
Poor electricity and water infrastructure places pressure on small businesses, affecting daily operations. SMMEs will also be interested in knowing how government intends to resolve the current water crisis various parts of the country.
Conducive business environment
SMME’s will be eager to hear how government plans to create a more conducive business environment for entrepreneurs. While the president’s promise to reduce regulatory barriers is promising, SMMEs will want details on how this will be achieved.
“Government has promoted small business development and entrepreneurism since 1994, but it needs to create a more conducive environment for conducting business if they are going to enjoy real and sustained growth,” concludes du Preez.