Yesterday the minister of Finance presented the 2015 Zimbabwe National Budget, a document that ideally is a huge focus for everyone, especially individuals involved in business and entrepreneurship or keen on it.
Out of the acres of details on the state of the Zimbabwean economy and the areas that our $4.2 billion budget is being targeted towards, there was information that was of great importance to small businesses (tech startups included).
So what exactly do the next 12 months hold for people in technology and startup entrepreneurs? Here are some highlights that came from the Zimbabwe National Budget address.
ICT expected to register a positive growth
With a national GDP growth set at 3.2% for the year, ICT growth is coming out ahead of other industries having been projected at double that rate at 6.4% for next year. All of this is being facilitated by the increase in mobile and internet penetration.
The figures from POTRAZ quoted in yesterday’s budget have put Zimbabwe’s mobile penetration at 127.9% However this figure does not consider the multiple SIM ownership phenomenon, something that POTRAZ official referenced recently.
There are now 326,576 fixed subscribers and 6 143,164 internet subscribers. This increase always offers a positive outlook for internet businesses focusing largely on the local market.
Tax deduction of computer software costs
Effective from the 1st of January 2015 software acquisition and development costs will be allowed as a tax deductible cost over a period of four years.
Dormant Company Returns
This is for the startups that have been lying idle. Any company that hasn’t been carrying any trade or business will not be subjected to any penalty for not submitting any returns under the Income Tax Act.
It also marries well with the extension of the Tax Amnesty which was being offered on penalties, interest and prosecution for the irregularities and non payment of taxes. This amnesty which was set to expire on 31 March 2015 has been extended to December 2015.
It looks like a strategy to get more informal businesses to come forward and start contributing to the state coffers.
You can read through the budget which is available below. What sort of opportunities do you think are available for tech startups looking at the government’s focus?
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Software development tax rebate is a great addition for local developers who can justify custom development charges that were scaring off some companies. Wonder if this applies to things like anti virus and accounting packages as well?