By Azwidohwi Mamphiswana
As Finance Minister Enoch Godongwana prepares to deliver the Revised Budget Speech this afternoon (Wednesday 12 March 2025), small businesses across South Africa hope for financial relief, tax breaks, and regulatory reforms to tackle funding shortages, high taxes, and poor infrastructure.
The National Budget Speech was initially scheduled for 19 February but was postponed due to disagreements within the Government of National Unity (GNU) over a proposed 2% increase in the value-added tax (VAT). The delay was meant to allow further negotiations on balancing revenue generation with economic growth.
According to Tertia Jacobs, an economist at Investec Treasury, the initial budget proposal was unlikely to stimulate economic expansion.
“The proposed February Budget Review 2025 indicates that the planned spending and tax increases are unlikely to support an acceleration in GDP growth,” she says.
For many small businesses, securing funding remains a significant hurdle.
Traditional banks often have strict lending conditions, requiring collateral that many entrepreneurs cannot provide.
“We need low-interest government loans or accessible grant funding without excessive paperwork,” says Thabo Mokoena, a township entrepreneur in the manufacturing sector.
While government programs like the Small Enterprise Finance Agency (SEFA) provide funding, many SMMEs complain about lengthy application processes and slow disbursements. Business chambers are calling on the government to streamline loan applications and improve transparency in fund allocation.
High corporate taxes and VAT compliance costs continue to strain small businesses, limiting their ability to reinvest in growth.
“The government should consider tax breaks for small businesses earning below a certain threshold or even a tax holiday for start-ups,” says business analyst Lindiwe Nkosi.
Entrepreneurs are calling for VAT exemptions on essential inputs to reduce costs and for simpler tax filing processes to ease compliance.
Protests have erupted over the VAT increase and Ithala Bank’s liquidation.
Tshepang Tau, an entrepreneur who marched to SARS and the National Treasury in Pretoria yesterday, stated, “We won’t have people to support us if VAT increases, and it will affect our stock.”
“As Black entrepreneurs, we struggle to get funding from international banks and Ithala’s closure is a major blow.”
Despite some improvements in load shedding, energy reliability remains a pressing issue. Many businesses have been forced to invest in backup generators or solar power, adding to their financial burdens.
“We hope the revised budget includes incentives for alternative energy, like subsidies for solar panel installations,” says Mokoena.
Beyond electricity, poor road infrastructure and unreliable broadband access also limit business operations, particularly in township and rural areas. Entrepreneurs urge the government to invest in logistics and connectivity.
Bureaucratic hurdles continue to frustrate small business owners, with many struggling to navigate complex registration processes, excessive licensing fees, and costly compliance requirements.
“The government must focus on ease of doing business, not adding more
restrictions,” concluded Mokoena.
Industry leaders recommend streamlining business registration, simplifying compliance, and adopting digital platforms to reduce administrative burdens.
Economists argue that balancing small business support with fiscal discipline will be one of the Finance Minister’s biggest challenges.
“The government is under pressure to reduce the deficit, but it cannot ignore SMMEs, which are key drivers of job creation,” says Nkosi. Azwi@vutivibusiness.co.za
