Full Text Available
Note: Clicking the button above will open the full text document at the original institutional repository in a new window.
The Impact of Section 12J Venture Capital Companies' Regime on Small and Medium Enterprises in South Africa
This study sought to examine whether the use of tax incentives to boost investment into the SME sector is an effective policy for economic development. More specifically, the study focused on the Section 12J tax incentive of the Income Tax Act of South Africa, which underpins the current venture cap...
Saved in:
| Main Author: | |
|---|---|
| Other Authors: | |
| Format: | Thesis |
| Language: | English |
| Published: |
Graduate School of Business (GSB)
2021
|
| Subjects: | |
| Tags: |
No Tags, Be the first to tag this record!
|
| _version_ | 1867613909186248704 |
|---|---|
| access_status_str | Open Access |
| author | Makhalemele, Moeketsi |
| author2 | Biekpe, Nicholas |
| author_browse | Biekpe, Nicholas Makhalemele, Moeketsi |
| author_facet | Biekpe, Nicholas Makhalemele, Moeketsi |
| author_sort | Makhalemele, Moeketsi |
| collection | Thesis |
| description | This study sought to examine whether the use of tax incentives to boost investment into the SME sector is an effective policy for economic development. More specifically, the study focused on the Section 12J tax incentive of the Income Tax Act of South Africa, which underpins the current venture capital companies' (VCC) regime for this country. This VCC regime is aimed at addressing the challenge of lack of access to finance by SMEs, and it does so by incentivising venture capital investors to provide equity capital to qualifying SMEs. These SMEs are, in turn, expected to grow and help reduce the economic challenges of poverty and unemployment in South Africa. A mixed methods research approach was adopted for this study. It was also inductive in nature, based on primary data collected from a survey of various stakeholders of the VCC regime using a convenience sampling method. The data variables of the study were based on factors relating to the impact that the VCC regime has had on SMEs in terms of financial performance and creation of decent employment. The study concludes that the VCC regime has had a positive impact on the South African SME sector in terms of financial performance and creation of decent employment. As a result, the VCC regime has shown to be an effective tool for addressing various economic challenges, such as: lack of access to finance faced by SMEs, high failure rate of SME businesses, and poverty alleviation through provision of decent employment by SMEs. Thus, the resultant recommendation submitted in the study is that the VCC regime should as such be extended beyond its current sunset date in order to ensure the South African economy continues to enjoy the benefits that the regime has to offer. |
| format | Thesis |
| id | oai:open.uct.ac.za:11427/33773 |
| institution | University of Cape Town (South Africa) |
| language | eng |
| last_indexed | 2026-06-10T12:43:38.154Z |
| license_str | Not specified — see source repository |
| provenance_str_mv | Harvested via OAI-PMH from UCTD — University of Cape Town Open Access Repository |
| publishDate | 2021 |
| publishDateRange | 2021 |
| publishDateSort | 2021 |
| publisher | Graduate School of Business (GSB) |
| publisherStr | Graduate School of Business (GSB) |
| record_format | dspace |
| source_str | UCTD — University of Cape Town Open Access Repository |
| spelling | oai:open.uct.ac.za:11427/33773 The Impact of Section 12J Venture Capital Companies' Regime on Small and Medium Enterprises in South Africa Makhalemele, Moeketsi Biekpe, Nicholas Makoni, Patricia SMEs financial performance job creation decent employment tax incentives venture capital access to finance Section 12J South Africa This study sought to examine whether the use of tax incentives to boost investment into the SME sector is an effective policy for economic development. More specifically, the study focused on the Section 12J tax incentive of the Income Tax Act of South Africa, which underpins the current venture capital companies' (VCC) regime for this country. This VCC regime is aimed at addressing the challenge of lack of access to finance by SMEs, and it does so by incentivising venture capital investors to provide equity capital to qualifying SMEs. These SMEs are, in turn, expected to grow and help reduce the economic challenges of poverty and unemployment in South Africa. A mixed methods research approach was adopted for this study. It was also inductive in nature, based on primary data collected from a survey of various stakeholders of the VCC regime using a convenience sampling method. The data variables of the study were based on factors relating to the impact that the VCC regime has had on SMEs in terms of financial performance and creation of decent employment. The study concludes that the VCC regime has had a positive impact on the South African SME sector in terms of financial performance and creation of decent employment. As a result, the VCC regime has shown to be an effective tool for addressing various economic challenges, such as: lack of access to finance faced by SMEs, high failure rate of SME businesses, and poverty alleviation through provision of decent employment by SMEs. Thus, the resultant recommendation submitted in the study is that the VCC regime should as such be extended beyond its current sunset date in order to ensure the South African economy continues to enjoy the benefits that the regime has to offer. 2021-08-17T08:17:49Z 2021-08-17T08:17:49Z 2020 2021-08-17T08:16:58Z Master Thesis Masters MBA http://hdl.handle.net/11427/33773 eng application/pdf Graduate School of Business (GSB) Faculty of Commerce |
| spellingShingle | SMEs financial performance job creation decent employment tax incentives venture capital access to finance Section 12J South Africa Makhalemele, Moeketsi The Impact of Section 12J Venture Capital Companies' Regime on Small and Medium Enterprises in South Africa |
| thesis_degree_str | Master's |
| title | The Impact of Section 12J Venture Capital Companies' Regime on Small and Medium Enterprises in South Africa |
| title_full | The Impact of Section 12J Venture Capital Companies' Regime on Small and Medium Enterprises in South Africa |
| title_fullStr | The Impact of Section 12J Venture Capital Companies' Regime on Small and Medium Enterprises in South Africa |
| title_full_unstemmed | The Impact of Section 12J Venture Capital Companies' Regime on Small and Medium Enterprises in South Africa |
| title_short | The Impact of Section 12J Venture Capital Companies' Regime on Small and Medium Enterprises in South Africa |
| title_sort | impact of section 12j venture capital companies regime on small and medium enterprises in south africa |
| topic | SMEs financial performance job creation decent employment tax incentives venture capital access to finance Section 12J South Africa |
| url | http://hdl.handle.net/11427/33773 |
| work_keys_str_mv | AT makhalemelemoeketsi theimpactofsection12jventurecapitalcompaniesregimeonsmallandmediumenterprisesinsouthafrica AT makhalemelemoeketsi impactofsection12jventurecapitalcompaniesregimeonsmallandmediumenterprisesinsouthafrica |