The South African Government is supporting small businesses in our country through various initiatives and current small business tax relief measures form part of these initiatives.
This study focuses on only two such tax relief measures namely section 12E of the Income Tax Act for entities that qualify as a small business corporation and Turnover Tax for entities that qualify as micro businesses. These two tax relief measures aim to give small businesses reduced tax rates to assist them to grow and contribute towards job creation in South Africa. The unemployment rate in South Africa in the second quarter of 2013 was 25.6%. This is thus one indication that the tax relief measures per section 12E of the Income Tax Act and Turnover Tax are possibly not meeting the objectives of assisting small businesses to grow and alleviate unemployment.