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(DPI) The National Assembly has passed the Small Business (Amendment) Bill 2020, expanding the criteria which allows an entity to be classified as a small business.
Minister of Tourism, Industry and Commerce, Hon. Oneidge Walrond presented the Bill for a second and third reading in the House on Thursday.
The amendment ensures that once a business employs a maximum of 25 persons, has a gross annual revenue of not more than $60 million, and total business assets of not more than $25 million, it can be classified a small business.
Minister Walrond explained that the amendment requires a business to satisfy all three of the criteria to be designated a small business, where previously, small businesses only had to satisfy two.
“Consider the hypothetical case Mr. Speaker…Business ‘A’ has 16 employees, which is below 25, it has $19 million in assets and $40 million in revolving funds annually. And then, Business ‘B’ that has the same 16 employees, the same $19 million in assets, but $250 million in annual profits. Clearly, in this scenario one is at a financial disadvantage, but both businesses would have qualified under this regime,” she said.
The amendment, therefore, levels the playing field for all the businesses in the same category. In other words, this class of business would now be broadly similar and would be able to compete with the new provisions.
It also now stipulates that a declaration of qualification must be supported by evidence. Applicants would be required to provide evidence such as financial statements and records of statutory deductions of qualification, prior to being recommended for approval.
“By this, we intend to remove opportunities whereby business that are not genuine small businesses, become so registered and we revert to the status quo where larger enterprises crowd out the smaller ones to the detriment of the latter,” Minister Walrond said.
Additionally, an amendment removes the power of the Minister to declare a business an “approved small business” and places this power in the hands of the Council which, once constituted, would comprise individuals with a wide range of relevant competencies.
The Council will exercise this power on the advice of the Small Business Bureau.
Meanwhile, Government Member of Parliament (MP) Hon. Yvonne Pearson reminded the National Assembly that the Small Business Bill was first brought to the House under the PPP/C Administration during the Eighth Parliament.
MP Pearson said the Small Business (Amendment) Bill 2020 would have a great impact on hinterland and Amerindian peoples, empowering them to be able to qualify for contracts, which would otherwise have gone to contractors from the coastland.
Minister of Local Government and Regional Development, Hon. Nigel Dharamlall, Minister of Culture, Youth and Sport, Hon. Charles Ramson Jr and Minister of Labour, Hon. Joseph Hamilton also supported the Bill.