GOVERNMENT

ASSISTANCE FOR SMALL

BUSINESSES
 MOST GOVERNMENTS PROVIDE SPECIAL ASSISTANCE
TO SMALL BUSINESSES THIS INCLUDES:
• Reduced rate of profits tax (corporation tax ) – this will allow a small company to have the chance to retain more profits in the business for
expansion
• Loan guarantee scheme – this is a government funded scheme that guarantees the repayment of a certain percentage of a bank loan should the
business fail. However, the rates of interest are often higher than market rates and the firm must pay an insurance premium to the government
• Information, advice and support will be provided through the small firms agency of the department for business, innovation and skills.
• In very economically deprived areas such as cities with high unemployment, governments finance the establishment of small workshops, which
are rented to small firms at reasonable rents. This is done to help small firm overcome the particular problems which they frequently experience
and this includes:
i. Lack of specialist management expertise and therefore the owner has to undertake all management functions, such as marketing, operations
management, keeping accounts and dealing with staff matters because the business can not afford to employ specialists in each of the areas
ii. Problems in raising both short and long-term finance as small firms have very little to offer to banks in exchange for loans.
iii. Difficulty in finding suitable and reasonably priced premises.
EXAMPLES OF SUPPORT FOR SMALL BUSINESSES
OFFERED BY THREE GOVERNMENTS.
INDIA
Small industries development organization :
• Credit guarantee scheme
• Capital subsidy scheme for technology upgrade

National small industries corporation:

• Marketing support scheme for small firms
• Technology support system.
• Credit support system e.g. for marketing activities and purchase of raw materials
 UNITED KINGDOM

• National department for business and enterprise grant for research and development
by small businesses
• Regional Selective assistance offers grants to small firms that invest capital in areas of
high unemployment and create jobs up to 35% capital grants available.
 TRINIDAD AND TOBAGO

Venture Capital incentive programme:

• Increase in supply of share capital to new enterprise sector.
• Tax credits offered to investors in new businesses
National enterprise development company:
• Financial support to small businesses
• Professional advice to entrepreneurs on marketing, business management and business planning.
Ministry of social development:
• Help with writing business plan
• Offers financial assistance to underprivileged persons to set up a micro-business