Ministry of Small and
Medium Enterprise Development

Status: Ongoing

Years: 2025-Present

Key Policy Areas: SME development

Type of Support: Policy development and implementation,

strategic communications, platform design
 

MSMEs are the backbone of the Zambian economy, comprising

97% of businesses, 88% of employment, and around one-third of

GDP. The Ministry of Small and Medium Enterprise Development

(MSMED) was created in September 2021 to support the growth

and development of this important part of the economic landscape.

 

JAP, in coordination with the Ministry’s Department of Planning,

has developed a comprehensive support programme for MSMED,

focusing on four key areas:

 

1. Encouraging Formalisation of MSMEs: JAP is dedicated to reducing the costs

associated with formalisation and highlighting its advantages for MSMEs. JAP

is currently developing a graduated approach to formalisation, a phased, step-by-step transition to encourage firms to move from the informal to the formal sector.

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2. Designing tax reforms to empower MSMEs: In collaboration with MSMED, JAP has developed a suite of tax reform recommendations focused on reducing the tax burden for MSME’s, while balancing wider fiscal priorities. JAP’s proposals were submitted to the Ministry of Finance and National Planning (MoFNP) and successfully advocated for at the Tax Policy Review Committee. All four recommendations were included within incorporated into the 2026 Budget and implemented on 1 January 2026.

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3. Tracking MSMEs through a comprehensive database: JAP is supporting the establishment of a database (MISM) to monitor MSMEs effectively.

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4. Resolving delayed payments to MSMEs under a payment platform: Efforts are underway to address and resolve delayed payments to MSMEs though an integrated payment tracking platform (PaMP), ensuring timely financial payments.

To oversee the progress of these initiatives, JAP has facilitated the formation of a Technical Working Group (TWG) comprising all relevant stakeholders. The first official meeting took place in October 2025.

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Key impacts

 

• Proposed 4 tax reforms to support SME’s, all of which were accepted in the 2026 National Budget.

• Roll-out of a communications campaign to help inform SMEs of the tax reforms and wider benefits.

• Design of SME database (MISM) and integrated payment tracking platform (PaMP).