Many would agree that one of the main growth areas in the South African
economy is small business. Small business has the potential to become a serious
player in the job market, if there is sufficient support by government. At the
recently held ACCA Budget Brief, the main point of the discussion was on the
stimulation of the economy, specifically in relation to SMMEs.
The event was spear-headed by ACCA SA?s Technical Manager, ThuliNtshele,
supported by four expert panellists; Henry Mundeya(SARS), LulluKrugel (KPMG),
HassenKajie (Nexia SABandT) and John Benson (Tax Practitioner).
Opening comments from the members of the panel underlined key changes in
monetary thresholds and highlighted a number of incentives such as
employment tax incentives.
According to Thuli Ntshele, small businesses make up an approximated 40%
of all entities in the economy, playing a vital role with potential to make
significant contributions to job creation, sustained employment and economic
Liveblog.mg.co.za reported that the tax review committee concluded that
lower tax rates for small business operations were not effective enough and
alone did not lead to growth or address tax compliance costs.The committee has
suggested replacing the tax regime with an annual refundable tax compliance
rebate. Even though small businesses have received R360million in tax relief, it
was emphasised that more focus and resources needed to pumped into the
small business sector to draw much-needed support to aid SMMEs and boost job
"Ideally, when it comes to taxes, we should consume only 30% of our
children?s ice cream and teach them about taxes. Ironically, it appears that we
consume all of the ice cream and still making our children pay for it.' -
The 2014/2015 budget speech provided necessary relief and adequate
incentives that will ultimately stimulate economic growth, but adequate growth is
not something we can live with. The solution to unemployment lies in cultivating
small enterprises and ensuring that they thrive.
One component highlighted was a recommendation for the formation of an
Administration Agency, a catalyst in the development, growth and education of
SMMEs. This idea furthermore sets good entrepreneur habits such as turning
obstacles into assets, working closely with government and the dti.co.za. This
was mooted by all members of the panel, but would this be integrated into the