According to the Ministry of Taxes and Duties, the number of small businesses in Belarus has decreased from 371,732 to 371,706 since the beginning of the year. The decline seems insignificant in the total numbers, but a closer look reveals that the number of LLCs is declining while there are more individual entrepreneurs.
The number of small- and micro-sized legal entities (LLCs and others, excluding individual entrepreneurships) was 102,231. As of June 1, 2021, a decline to 98,738 such structures was recorded. Going into more detail, there were 11,282 small legal entities (employing 16 to 100 people) in January, and 10,933 in June. With micro-organizations (employing less than 15 people): as of January 1 of this year, there were 90,949 of them, and as of June 1, there were 87,805 of them, showing the largest proportional decline.
Small businesses have been seriously affected by the pandemic: there was a decrease in purchasing power, and large deferred demand. The political crisis during the past year also had a significant effect. According to a study by SATIO the political crisis in the country, according to respondents, brings more problems to small business than the COVID-19 pandemic.
Meanwhile, there are more individual entrepreneurs in Belarus, and it´s possible that some micro-organizations have converted to operate in this form. At the beginning of the year there were 269,501, in June - 272,968. The largest quantitative growth occurred in Minsk - by 784 and in the Minsk region - by 841. In the Brest region, their number increased by 407, in Vitebsk - 307, in Grodno - 554, in Gomel - 455, in Mogilev - 119.
Note that the number of individual entrepreneurs has been growing over the past four years. As of January 1, 2017, there were 236 thousand of them in the country, and at the beginning of 2021, the statistical authorities recorded 269.5 thousand.
As for the number of medium-sized organizations, their number has remained practically unchanged over the recent period.
Note that the share of small business in budget revenues has also grown: in 2019 it amounted to 26.3%, in 2020 - 28.3%. The growth of revenues to the treasury increased both for small organizations (from 15.2% to 17.2%) and for individual entrepreneurs (from 2.2% to 2.3%). A slight decline occurred in micro-organizations - from 8.95 to 8.7%.
According to surveys by the IPM Research Center, for many months the “high uncertainty of the economic environment” and “macroeconomic instability” have been leading among the barriers to business growth. Third place in the five barriers is taken by "mistrust of the legal system." Barriers related to the financial condition of counterparties - low demand from consumers and financial problems, reflecting high loan debt and non-payment of counterparties - moved up to take the fourth and fifth places in the last month.
We will send you articles keeping you up to date with the latest trends and developments in accounting, taxation or legal fields.