ISSUES OF REGULATION OF SMALL BUSINESS DEVELOPMENT IN THE REGION

ISSUES OF REGULATION OF SMALL BUSINESS DEVELOPMENT IN THE REGION

Konstantin Kurpayanidi

Doctoral student, Candidate of Economic Sciences, Fergana Polytechnic Institute,

Uzbekistan, Fergana

ABSTRACT

In the modern economy, small business occupies a significant share both in GDP and in the creation of new jobs. In the article, the author examines some issues of regulation of small business in the country and the region, based on the materials of the Fergana region of the Republic of Uzbekistan.

Keywords: entrepreneurship, small business, GDP, GRP, regulation, economy of Uzbekistan.

Modern small business is undoubtedly one of the most important subsystems of the market economy, creating prerequisites for its sustainable development. Small entrepreneurship in Uzbekistan ensures the creation of jobs with low capital costs, filling the market with goods and services, fiscal revenues to state and local budgets, employment of the population; promotes the development of human capital, competitive markets and innovations, improving the standard of living of the population and social stability of society.

Small business as a socio-economic phenomenon affects many objects and generates certain connections between them, which allows us to study its development from the point of view of system analysis. In the spatial aspect, being a subsystem of the region, small business is able to respond quickly to economic changes, serve narrow and specific market segments and adapt easily, contributing to the rapid redistribution of resources in the economic system. Material and financial constraints encourage small businesses to seek competitive advantages in the cognitive potential of available opportunities. The dynamic and sustainable development of this sector of the region's economy is aimed at creating an effective competitive environment and improving the quality of life of the population. It should also be noted that in developed countries, a greater number of small firms are dynamic and efficient, having a high technological level of individual industries that accelerate the innovation process in a market economy [1,2]. At the same time, not all foreign economists show the above-mentioned optimism in assessing the economic role of small business in the development of industry due to the fact that the emergence of new firms is associated with growing unemployment, falling economic activity, as well as with undermining the position of existing firms (large and medium-sized) with expensive equipment and high social status of employees of these enterprises, while small firms in these conditions represent temporary work with low pay [3]. Thus, small business is not an economic panacea and is not always capable of innovation. Nevertheless, in the conditions of restructuring of national economies, lack of financial resources at all levels, small forms of entrepreneurship can become points of growth, contribute to the creation and development of mechanisms (economic, innovative, organizational and others) that allow for the restructuring of the economy as a whole, which is of particular interest to the national economy of the Republic of Uzbekistan. Small business today is a dynamically developing sector of the regional economy of Uzbekistan. It is here that the most jobs are created, new production facilities that are significant for the region are being opened. The importance of methods of regulating the development of entrepreneurship is determined by their indirect influence on the overall level of socio-economic development of the region and the country as a whole [4]. Research shows that the level of development of small business in the region, especially in conditions of polarization of the economic space, depends, firstly, on the functional role of the region, determined by its socio-economic situation; secondly, macro- and meso-economic parameters of the business climate and thirdly, the presence of a population inclined to conduct business in a particular region with its inherent level of profitability and degree of risk. The orientation and degree of influence of these factors are differentiated both by stages of entrepreneurship development and by territorial entities of various levels of development. Thus, the first and third factors largely determine the initial level of entrepreneurship development in the region, and between the level of socio-economic development of the region and the saturation of the regional space by small businesses. The high level of socio-economic development of locomotive regions and supporting regions determines the need for the development of small enterprises "embedded" in their economy, while in problem regions and regions of special attention there is a great need for the development of individual entrepreneurship, leveling the social consequences of low economic development and not fully used resources of the territory growth [5]. The possibilities of accelerating the development of small business in the region in the medium term by increasing the level of socio-economic development are limited due to the significant stability of the latter in the time dimension. A similar conclusion can be drawn with regard to the development of small businesses by increasing the population inclined to conduct entrepreneurial activities.

The results of monitoring the activities of enterprises in the field of small entrepreneurship show that the share of small entrepreneurship in GDP in January-December 2020 amounted to 53.9%. The number of small businesses per 1000 people of the population was 15.6 units. In January-December 2020, 93.2 thousand new small enterprises and microfirms were created again (without dehkan and farms), which is 0.4% more than the same period in 2019. In January-December 2020, the volume of exports of products (works, services) of small businesses amounted to $ 3100.6 million. US$, or 20.5% of its total volume. In January-December 2020, the share of small businesses in the total volume of industrial production amounted to 27.5%. For comparison, the same indicators for the Ferghana region. The share of small businesses in GRP in January-December 2020 was 67.9% (in 2019 68.3%). In January-September 2021, the share of small business in GDP was 55.7% (55.2% in January-September 2020). In January-September 2021, the volume of retail turnover of small businesses amounted to 135 032.1 billion soums, or 80.8% of the total retail turnover volume. By January-September 2020, the growth rate reached 109.1%.

In the Ferghana region, the number of small businesses per 1,000 people was 13.9 units. In January-December 2020, the volume of exports of products (works, services) of small businesses in the region amounted to $ 318.8 million. US$, or 57.4% of its total volume. The share of small business in the total volume of industrial production of the region amounted to 49.5 %^[1] .

At the same time, the solvency and financial stability of small enterprises in the region remains at a high level. According to the conducted research, the creation of favorable fiscal conditions for small business, contributing to its development in priority areas for the economy of the region, involves the following regulatory impacts at the national and regional levels:

1. Establishment of the maximum level of the tax burden in the amount of 10-8% of tax deductions of profits with the introduction of a five-year moratorium on changing this threshold value in order to stimulate the production and investment activity of small businesses [6,7].
2. Conducting regular monitoring of the size of the tax burden of small businesses through the organization of statistical accounting of tax revenues from small businesses.
3. Creation of special fiscal conditions for investment activities of small enterprises of high-tech and knowledge-intensive activities of the region by abolishing taxation of profits invested in modernization and expansion of production.
4. Reduction of the value added tax rate from the current 15 percent to 12 percent, which, according to hypothetical estimates, will increase the volume of small business products of the republic by 5-7 percent and the volume of investments by 25-40 percent.
5. Development at the regional level of intervals of recommendation values of correction coefficients of basic profitability for certain types of entrepreneurial activity as a basis for decision-making on the establishment of these parameters of the unified income tax system at the regional level.
6. Provision of regional premises on a preferential basis, using an industry coefficient.

Thus, reforms in the field of support and development of SPE (Small private enterprise) in the context of the region, including reducing the tax burden, introducing a mechanism to fully stimulate the development of SPE in the near future will contribute to the development of the most favorable conditions for the dynamic and effective development of entrepreneurship and in the country as a whole.

References:

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