Nobleman Runyanga

Government is set to pursue the simplification of the tax system for the small and medium enterprises (SMEs) and the informal sectors as part of its raft of initiatives to support them.

This was revealed by the Ministry of Women’s Affairs, Community, Small and Medium Enterprises Development in a statement this week.

“The Government acknowledges the challenges being experienced by the (SME) sector and will continue its efforts towards solving them,” read part of the statement.

“Recently the ministry convened a dialogue between Government Ministries and Agencies and SMEs and Informal Sector Associations on key challenges affecting the sector. Thirteen SMEs and informal sector associations attended and the parties agreed to work on (the) inclusion of the sector in the Tripartite Negotiating Forum (TNF), (the) simplification of taxation system, modalities for ring-fencing public procurement from SMEs and the informal sector,” the ministry said.

The ministry indicated that it would continue to facilitate dialogue between the two sectors and Government.

It highlighted that it was facilitating for players in the sectors to participate in such dialogue.

“The ministry has drawn up a compendium of the SME and Informal Sector Associations to ensure (that) no one is left behind and calls upon all SME and informal associations which are not on this platform to come forward and participate,” the ministry said.

The SME and informal sectors contribute significantly to the national economy. It provides employment to over 80 percent of the country’s working population and contributes over 60 percent of the national gross domestic product (GDP). The ministry has been linking SMEs vertically to large corporations and to fellow SMEs using value chains such as agriculture, manufacturing, mining and services as a way of promoting their growth. It has been lobbying for user-friendly services and regulations for SMEs and the informal sector including business registration and licensing.