National budget speech could be critical to SMEs

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Heather Lowe, Head of Enterprise Development at FNB Business, says, "The budget speech provides a good indication of what big and small business can expect from an economic and regulatory point of view. Over the years, significant regulatory amendments have been made during the budget speech; therefore small business owners should make time to familiarise themselves with its contents."

Key areas

• Tax Policy: the South African government is currently on a drive to boost small businesses and one of the key focus areas is the country's tax policy. Over the years, we have seen numerous reforms to minimise the tax burden on SMEs, therefore, this should be a key area of interest for small businesses. It will be interesting to see whether processes such acquiring a tax certificate became simpler, in addition to other possible concessions.
  
• Funding for Ministry of Small Business Development: SMEs should be interested in understanding if funding or capitalising is how the Ministry will meet the needs of the SME and, more importantly, see if there are any direct incentives for their businesses.
  
• National Development Plan (NDP) updates: the NDP holds the blueprint for South Africa's economic development and SMEs are an integral part of the plan. NDP decisions and its rollout could have a direct impact on SMEs across a number of industries. Whether concrete implementation steps will become public is conceivable
  
• Infrastructure Investment: the government's infrastructure programme has a direct and indirect impact on SMEs, which depend on sub-contracting deals to stay in business. It will be important to get an idea of which infrastructure projects are on the government's list of priorities. This is especially important for SMEs in order to restructure business development plans.
  
• Procurement: this remains a key factor in the sustainability of SMEs. Over the last 20 years, we have seen various policy and administrative shifts; it should encourage an inclusive procurement environment where SMEs receive access to the supply chain of major industries. SMEs should be keen to hear whether National Treasury will influence the procurement of services in the public sector.

"Overall, it is important to make sense of the budget as it contributes significantly to shaping the operating environment for businesses in South Africa," concluded Lowe.