Acta Universitatis Danubius. Œconomica, Vol 15, No 4 (2019)

The Effectiveness of Tax Relief Initiatives on SMEs in South Africa

Yergenthren Naicker, Rajendra Rajaram


Tax relief initiatives have been introduced by the South African government inorder to assist small business to grow and become sustainable. The high failure rate ofbusinesses coupled with the alarmingly high rate of unemployment in the country is the mainreason the government embarked on these initiatives and strategies. The different taxinitiatives available to qualifying small businesses include small business corporation tax andturnover tax. The research has been undertaken to determine if small business tax initiativesintroduced by SARS are effective and are being utilised by small businesses. A questionnairewas sent to eighty five small business owners to determine if they are aware of small businesstax and turnover tax and also to determine if they are utilising these initiatives. The findingsfrom this study reveal that approximately half of the respondents do not know about thesespecific tax initiatives. Only a small percentage of small business are eligible for smallbusiness tax and none of the respondents in the sample are eligible for turnover tax. Themajority of small business owners agree and strongly agree that the initiatives introduced bythe government are ineffective and need to be revised.


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