Small and Medium Enterprises Bill sent to parliament

The Parliament Committee on Economic Affairs has completed its review of the Small and Medium Enterprises Bill and sent it to the parliament. A 14-member council has also been established to implement the policies determined by the government to develop small and medium businesses.

The Small and Medium Enterprises Bill, which was submitted to the parliament by the Parliamentary Group of Maldivian Democratic Party (MDP) during the government of former President Mohamed Nasheed, states that the 14-member Small and Medium Enterprises Council should include five ministers, seven civil society members, one member of the Board of Directors of Capital Market Development Authority (CMDA), and the Commissioner General of Taxation or the Deputy Commissioner General of Taxation of Maldives Inland Revenue Authority (MIRA). This council should be established within two months after the bill is ratified.

Out of the 14 members included in the council, salaries and allowances will be provided to members who are not included in council as a result of their employment post.

The purpose of the Small and Medium Enterprises Council is to advise the minister responsible for implementing the economic policies created by the government in relation to the development of small businesses. The council would also be responsible for drawing up a structure to develop and encourage small businesses, as well as for providing expert advice and assistance in the area.

The bill divides small businesses in to three categories, which are Micro Enterprises which have less than 6 employees and make an annual income not exceeding MVR 500,000; Small Enterprises which have 6 to 30 employees and make an annual income between MVR 500,001 and MVR 5,000,000; and Medium Enterprises which have 31 to 100 employees and make an annual income between MVR 5,000,001 and MVR 20,000,000.

The government provides assistance to such businesses provided that shares are held in the businesses by Maldivians. The bill states that financial assistance provided to a small sole proprietorship shall not exceed MVR 500,000; while for partnerships and cooperative societies the amount is MVR 1,500,000. These sums must be fully repaid to the government later.

The bill states that MVR 50,000,000 should be included in the state budget annually for the development of small businesses, and that this sum should be deposited in the fund allocated for disbursing money for the development of small enterprises.