There is no doubt that small businesses lie at the heart of Australia’s economic engine room.
Of course, businesses of all size have a role to play in keeping the economy afloat, so it’s fair to say that if the ‘SS Australia’ is going to successfully chart the rocky economic waters we’re navigating, we’ve got to keep our business – particularly small business – machinery humming.
It’s worth noting that in some engine rooms, the machinery a ship needs to operate is often separated into different areas in order to minimise any potential damage.
Similarly, when it comes to company tax cuts – in light of the current bill – large and small businesses may need to be looked at separately, to ensure the small business sector isn’t disadvantaged by the apparent lack of political will that exists within the opposition and senate crossbench for the wholesale changes prescribed in the Turnbull Government’s Enterprise Tax Plan.
Nothing unites our politicians quite like small businesses do.
The substantial contribution our mum-and-dad small business owners make to the economy is one of the few things law-makers on all sides can actually agree upon.
Ninety-seven per cent of businesses in Australia are small business and the economic benefits of giving them all a tax cut shouldn’t be underestimated.
Reducing the tax burden to 27.5 per cent initially (progressively reaching 25 per cent by 2026/27) for businesses with a turnover of up to $10 million, along with increasing the tax discount for unincorporated small businesses – particularly when combined with measures such as the instant asset write-off – will be significant for job creation and economic growth.
Small business owners I’ve spoken to about the tax cuts say they will put the money they save back into their business, not into their pockets. This means new plant and equipment, expansion and extra staff.
Small businesses are already the biggest employer in Australia; as a nation we’re increasingly relying on the sector to keep people in jobs, drive growth and maintain our high living standards, particularly as we transition away from a resource-driven economy.
And when you consider there’s close to three million SMEs in Australia, if just a fraction of them employed one new worker each, it would be a game-changer.
- Kate Carnell – Australian Small Business and Family Enterprise Ombudsman