Govt To Expedite SME Sector Formalisation – Minister

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By James Muonwa

THE government says it has escalated efforts to formalise the operations of players in the small-to-medium enterprises (SME) sector in a bid to harness their contribution to the country’s fiscus through taxation.

Women Affairs deputy minister, Jennifer Mhlanga said Thursday the proliferation of SMEs is evidence of the entrepreneurial spirit among Zimbabweans, which needs to be reciprocated by government creating an enabling environment for informal businesses to thrive.

“As a ministry in the SME sector we have created pillars that we think can help us formalise. We want our small and medium businesses to operate from proper infrastructure with proper sanitary facilities,” she said.

“We have tasked local authorities to create these factory shells so that our people are operating from places that are decent, places that can also be monitored by the government.

“We have also gone further to say we want to assist our small players to access markets. The formalisation drive is in the process, but much more still needs to be done.”

The deputy minister underscored the need for the SME sector to dutifully pay taxes, while challenging the Zimbabwe Revenue Authority (ZIMRA) to collect its dues to contribute to the national purse.

“We want to ensure that small and medium enterprises are active in terms of paying taxes and rates to local authorities. So the onus is on government to then go out there and collect the taxes, and l am sure that they are collecting the taxes,” said Mhlanga.

The promotion of SMEs with an estimated $5 billion circulating in the informal markets, said the deputy minister, helps break monopolies of some large corporates.

Products manufactured and sold by some of the sector players are of high quality and standard with huge potential to compete internationally, she said.

According to economist Eddie Cross, more than 60% of Zimbabwe’s working population is now surviving on vending or other informal sector activities adding there is need for the government to recognise the trade and provide necessary safety nets.

“At least 10 million people owe their source of livelihood to activities of the member of the family who is vending. Therefore, it is the obligation of the local authorities and there are over 100 of them to provide facilities for vendors within the councils. That is where the future of Zimbabwe’s economy lies,” he said.