Integrated digital platforms drive SME growth, tax revenues: Expert
Deploying unified digital business services offers a practical method to bring informal enterprises into the regulated economy while increasing national revenue collection, according to trade and deve...
Experts assert that the integration of digital platforms plays a crucial role in fostering the growth of small and medium-sized enterprises (SMEs) and boosting national tax revenues. According to Boris Titov, the Special Representative of the Russian President for International Organisations, SMEs serve as the backbone of economic development.
In contrast, developed nations have witnessed the benefits of stringent regulations enabled by digital technology, enabling a harmonious relationship between governments and businesses.
During a presentation at the 9th World Investment Forum in Doha, Titov elaborated on how digital administration revolutionizes business landscapes. He pointed out that SMEs constitute 90% of global businesses and employ more than half of the world's workforce. However, he cautioned that growth in many developing countries is hampered by informal operations, administrative burdens, corruption, and government and large corporation discrimination.
Titov lamented that most SMEs in developing countries operate in the informal sector, forced to pay bribes instead of taxes and faced with additional cross-border barriers.
To tackle these structural challenges, Russia established an integrated 'one-stop' digital portal, unifying corporate registration, tax management, and commercial banking services. This initiative streamlined daily accounting, simplified payment processing, and enhanced private sector access to commercial bank credit. As a result, the proportion of informal SMEs operating in Russia dwindled from 80% to under 10%.
Between 2018 and 2024, the total number of registered small businesses surged by 1 million, and registered self-employed individuals reached 15 million, accounting for over 10% of the national population. Annual tax revenue generated from the small business sector doubled to $119bn, while access to business loans expanded nearly threefold, and suspicious financial transactions decreased by 64%.
Titov noted that the implementation of such integrated systems is already generating positive outcomes in neighboring markets. In Kyrgyzstan, for instance, their expertise helped double the SME sector's tax base within two years. Moreover, similar integrated portals are operational in China, India, and Europe.
Written by urgent.news from Gulf Times Business's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
