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de Chalain & Associates | INCENTIVES
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INCENTIVES

Incentives

The key schemes, which the government offers to business, in which we offer services, with brief details are:

Manufacturing Competitiveness Enhancement Programme (MCEP)

A DTI programme of cash based tax free incentives running until 31 March 2018 applicable for existing companies on a cost sharing basis when expanding through capital investment, green technology upgrades, competitive enhancements, feasibility studies or cluster enhancements. Please see below MCEP brochure for further details:

CLICK HERE FOR MCEP SCHEME DETAILS

Black Industrialists Scheme (BIS)

The Department of Trade and Industry (DTI) has launched an incentive scheme called the Black Industrialists Scheme (BIS). The scheme objective is to unlock potential of black industrialists within the SA economy through financial interventions. Please see below BIS brochure for further details:

CLICK HERE FOR BIS SCHEME DETAILS

Production Incentive Programme (PIP)

This incentive is aimed at structurally changing the clothing, textiles, footwear, leather & Leather goods manufacturing industries by providing funding assistance to invest in competitiveness improvement interventions.  The incentive benefit equals to 7.5% of a company’s Manufacturing Value Addition. This benefit will be referred to as the Benefit Ceiling which is the maximum amount that will be available to an applicant in a specific financial year. This scheme forms part of the overall Clothing and Textile Competitiveness Programme

The Enterprise Investment Programme (EIP)

What is it? A programme of cash based tax free incentives applicable to most new manufacturing and tourism businesses as well as expansions of these in in certain circumstances.

This scheme was suspended with effect from 20 September 2013. Sadly this means that there is currently no scheme which would stimulate investment in startup manufacturing entities. The DTI has at various times said that a replacement for this scheme will be launched. We will advise when it happens.

Automotive Investment Scheme (AIS)

This is a taxable cash grant of 20% of the value of qualifying investment in productive assets. This incentive is applicable to light motor vehicle manufacturers; component manufacturers or those who will achieve 25% of the total entity turnover as part of a light motor vehicle manufacturer supply chain, locally and/or internationally.

Black Business Supplier Development Programme (BBSDP)

This is a cost-sharing grant offered to black-owned small enterprises to assist them to improve their competitiveness and sustainability to become part of the mainstream economy and create employment. This programme grants up to a maximum R1million (R800000 for machinery and equipment and R200000 for development and training).

Critical Infrastructure Programme (CIP)

This is a cost sharing grant for projects designed to improve critical infrastructure in South Africa. The grant covers qualifying development costs from a minimum of 10% to a maximum of 30% towards the total development costs of qualifying infrastructure.

Co-operative Incentive Scheme (CIS)

The Co-operative Incentive Scheme is a 100% grant for registered primary co-operatives. This incentive is a 90:10 cost sharing grant.  Improves viability and competitiveness of co-operatives by lowering the cost of doing business through an incentive that supports BBBEE. Eligible activities i.e. business development services, working capital.

Clothing and Textile Competitiveness Improvement Programme (CTCIP)

Provides funding assistance to the clothing, textile, footwear, leather and leather goods sectors – aiming to create sustainable capabilities and employment in the industry and enable SA to compete with other low-cost production countries.

Export Marketing and Investment Assistance (EMIA)

The purpose of assistance under this scheme is to partially compensate exporters for costs incurred in respect of activities aimed at developing export market for South African product & services and to recruit new foreign direct investment into South Africa.

Incubation Support Programme (ISP)

This incentive provides funding for business incubators that provide support to entrepreneurs with small, micro and medium enterprises (SMME’s), typically supplier development, enterprise development, skills transfer and marketing opportunities.