the Government’s support is crucial for development of small and medium-sized enterprises for development human resources, technical assistance and exploring external market, stated the B4B Insights Forum’s first quarter report.
The report pointed out that Myanmar’s SME sector lacks real time information and data. There are nearly 200,000 registered SMEs in Myanmar, but registration by electronic means can facilitate working procedures. There is competition between illegal foreign businesses and local micro enterprises. Tax payers are making only a small profit after calculating profit margin, while businesses with tax noncompliance are reaping greater profits.
Raw materials are imported from foreign countries, which adds additional cost in production. Therefore, supporting industry is required for SMEs. Additionally, they lack technique to manufacture value-added products. Lack of market information leads to high input and production cost for small businesses, resulting in losing market share in a highly competitive market.
Besides, development of start-up businesses and SMEs is moving slowly due to inadequate government support for SME sector. Some start-up businesses burdened are with tax although their profit is not ensured. Therefore, some small businesses are running their trade without seeking registration, concerned over tax burden. As a result, a number of informal businesses is increasing, making them face handships in accessing financial support. A small number of staff in the tax department causes delay in processing.
The report also called for market analysis, establishing supporting industry, upgrading payment system under public-private partnership together with related organizations, tax-exemption for start-up businesses for the first three years and increasing employment and building capacity of staff in the internal revenue departments. Additionally, gaps in the existing law cause barriers and challenges for SME sector, mentioned the report.
By Nyein Nyein