Minister of finance Nhlanhla Nene’s budget has firmly responded to the call to encourage and promote entrepreneurship and the small business sector in South Africa, says Sipho Zikode, the acting Chief Executive Officer of the Small Business Development Agency (Seda), an agency of the Ministry of Small Business Development.
Zikode says that tax Exemption for a small business with an annual turnover below R335 000 is a win-win for tax authorities and the small business sector. “While the exemption lifts the tax burden on small businesses, it will also encourage greater levels of compliance by the small business sector as they will need to enter the formal mainstream economy through registration with the appropriate SARS structures in order to benefit from this exemption,” says Zikode.

Zikode also welcomes the R3 billion allocated to the Department of Small Business Development for mentoring and training. “While we accept that not everyone has the will and desire to be an entrepreneur, we should aim to provide all the necessary support to those who have made the decision to choose entrepreneurship as a career path,” adds Zikode.

Zikode says the funds will go a long way in supporting and improving the “township-economy”. It will also help develop a much broader support network by the Department of Small Business Development’s agencies to be more visible and accessible to more beneficiaries of small enterprise support services.

One of Seda’s main contribution to the small business sector is helping small businesses with debt collection from government departments. Zikode says he is also pleased that Minister Nene has taken the initiative to make government officials accountable for late payment of invoices from small businesses. “We need to continue to sensitize government officials to the fact that for small businesses, every invoice matters and it may very well be the last line of defense that determines financial viability or failure of that enterprise,” says Zikode.

To this end, Seda runs a hotline through which small businesses can request assistance in securing payment from government departments for services rendered. “The hotline is our real-time link with our target market and also allows us to act swiftly and hold government officials accountable,” concludes Zikode.

 

Issued by SEDA