Looted small businesses to benefit from R2.3 billion from treasury – must be tax compliant
- National Treasury has laid out its plans to assist various sectors impacted by Covid-19 and the recent looting in KwaZulu-Natal and Gauteng.
- According to treasury's director general Dondo Mogajane, a total of R36.198 billion worth of relief funds will be made available to assist various sectors.
- The South African Special Risks Insurance Association will get a R3.9 billion injection, while an additional R2.3 billion will be made available by government.
- However, businesses that are not registered or tax compliant might not benefit.
- For more stories go to www.BusinessInsider.co.za.
National Treasury has allocated R2.3 billion to help businesses affected by the recent looting in KwaZulu-Natal and Gauteng, provided they are registered and tax compliant.
The plans were announced at a briefing on Wednesday, following President Cyril Ramaphosa’s address to the nation at the weekend. A total of R36.198 billion worth of relief funds will be made available to assist various sectors impacted by Covid-19 and the recent unrest, according to National Treasury Director General Dondo Mogajane.
The R2.3 billion will assist small businesses through the Department of Small Businesses and the Department of Trade and Industry, Mogajane added.
“There is money that is reprioritised within the Department of Small Businesses and the Department of Trade Industry and Competition. The Presidency and [Treasury] met with the insurance companies,” said Mogajane. "There are ongoing discussions… as part of the support that is going towards [helping] uninsured businesses.”
Although treasury is keen on helping small businesses recover as soon as possible, there are various limitations.
“We are looking at mechanisms firstly to try and identify the businesses that have been affected, the buildings that may have been destroyed,” said Treasury’s Ismail Momoniat.
“Until and unless we know the scale of the damage and how extensive it is, and what type of businesses to cover, it’s really difficult to even have a scheme that we think would be workable,” he added.
A further R3.9 billion will come from the state backed South African Special Risks Insurance Association (Sasria), which will also make payments to affected businesses which are not insured. Submissions for claims can be sent to firstname.lastname@example.org.
Treasury has dedicated a further R700 million to assist the SANDF, R350 million for SAPS and reintroduced the R350 relief grant until March 2022.
Registered businesses first in line
With treasury keen on helping small businesses get back on their feet, Finance Minister Tito Mboweni reiterated that it is difficult to assist businesses that are not registered or tax compliant, saying it becomes “very difficult for us to come in handy to support businesses which have not been good corporate citizens".
“I think we should, in the first instance, really focus our attention on the legally registered businesses that can be assisted,” he added.
According to SARS Commissioner Edward Kieswetter, the criteria for any business to draw support or relief measures from government is that they be tax compliant.
“You must be up to date with all outstanding taxes or have agreements in place to pay those taxes over a particular repayment period,” said Kieswetter.
Business owners are therefore encouraged to ensure compliance in the next few weeks in order to gain access to the relief measures set out by government.
Get the best of our site emailed to you every weekday.
Go to the Business Insider front page for more stories.