In his Eighth State of the Nation Tackle on 30th Nov this year, President Uhuru Kenyatta submitted a report to the parliament recognizing Micro, Smaller, and Medium Enterprises (MSMEs) as the lifeblood of Kenya’s economy nonetheless a substantial variety of them are unlicensed.

In accordance to the 2017 Financial Survey, there are about 1.56 million accredited MSMEs and 5.85 million unlicensed very similar corporations in Kenya.

This implies that significantly less than 27 percent of all companies in Kenya are registered. Out of these, 92.2 % are micro-enterprises while only 7.1 p.c and .7 p.c are smaller and medium enterprises respectively.

The purpose some of the MSME operators give for not registering their corporations is that they dread currently being subjected to substantial taxation that may close up taking in on their income.

On the other hand, as you will before long learn, there are many positive aspects that await unregistered MSME operators as taxpayers that together with financial loans and authorities services. 

Bid for government contracts

Bid for authorities contracts

As a registered smaller organization operator as a taxpayer, you will be putting your self in the best position to bid and acquire governing administration tenders and trade with the governing administration and non-government institutions.

If your enterprise is not registered, you cannot bid for authorities contracts or even companion with other businesses to get advantage of communal benefits which includes important networks, primarily with greater corporations with who they could even enter into sub-contracts.

As a result, you will continually be locked out of beneficial enterprise associations. Simply set, if an business is not a taxpayer it can’t mature!

Personalized tax and customs advisory services

Individualized tax and customs advisory providers

These are products and services available by the Kenya Revenue Authority (KRA) by way of its broad community, social media, and telephony amid others to hell MSMEs operators realize the tax and customs surroundings especially if they intend to get into import and export business.

This is in addition to current market and networking chances by way of its taxpayers’ roundtables that the taxman organizes to convey jointly firms for uses of sharing concerns affecting them and getting organization guidance in line with the main business enterprise of the authority.

It is throughout these conferences that the Authority avails possibilities for business owners to community and even create new marketplaces.

Import and export incentives

Import and export incentives

As a tiny business operator, your intention is to improve from serving the area individuals to undertaking enterprise globally. No business enterprise operator would their undertaking stay stagnant therefore the will need for registration.

MSMEs registered with the taxman stand the opportunity of receiving import incentives that include things like minimized import tariffs on inputs these as machinery and uncooked resources to spur manufacturing of merchandise for export where the authority provides free of charge VAT for its members.

The taxman also has a provision for cash allowances on mounted machinery and a possible 20 % export compensation arrangement.

Numerous business opportunities

Many company alternatives

Did you know? In line with the federal government directive on public procurement, 30 per cent of all procurement at KRA goes to enterprises operate by the youth, women of all ages, and people today with disabilities which are largely MSMEs. Yet another cause why you need to register as a compact enterprise operator.

Unregistered enterprises ought to sign up as taxpayers in purchase to open up doorways to business enterprise possibilities that can only be accessed when the business acquires the all-important PIN variety.

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