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Budget must address tax reform, small business support: ACCI

Business

The government must also look to help grow SMEs’ productivity via digitisation and further address the labour shortage, says the industry body.

By Josh Needs 10 minute read

Tax reform, more support for small business and expenditure restraint should be priorities for the government’s May budget, says the Australian Chamber of Commerce and Industry (ACCI). 

In the ACCI’s pre-budget submission, it declared the May budget as the government’s first real opportunity to establish its fiscal position, calling for it to initiate tax reform and to also build on the outcomes of the Jobs and Skills Summit. 

“Australia’s tax system is replete with inequities and anomalies and is too reliant on unsustainable and distortionary taxes that are either inherently inefficient or inefficient by design,” said the ACCI’s submission. 

“Achieving comprehensive tax reform that supports federal, state and territory budgets over the long-term while addressing distributional impacts and promoting economic growth, is not easy and will take time.” 

“The Council for Federal Financial Relations (CFFR) is the appropriate forum to initiate this discussion and begin the reform process, so tax reform should be included as a standing item on the CFFR agenda.” 

The chamber said a key area lay in the small business tax rate of 25 per cent, which only included businesses with an aggregate turnover of less than $50 million. 

It said the government should expand it to include businesses under a $250 million turnover because small businesses rely on the strength of larger companies as both suppliers and customers and expanding the lower tax rate would assist with larger firms’ growth. 

The ACCI also called for the government’s May budget to further address the labour and skills shortages that face many sectors across the country. 

Its key recommendations were greater funding for the employment services system to better assist those that are long-term unemployed as well as undertaking improvements to disability employment services.

“The participation rate of people with a disability is also lagging that of the general population, estimated to be 30 percentage points lower than people in the same range without a disability,” said the ACCI. 

The chamber also said the government needed to address the digitisation of the economy and the slower update in digital technologies by SMEs than larger firms hampering their productivity.

The ACCI recommended the government establish a trusted adviser service for small businesses that provides information and advice on digital opportunities as well as raising cyber security awareness. 

“Consideration should be given to establishing a body as a central nodal point for information and advice on digital opportunities for small business,” it said. 

“In addition to improving digital literacy and awareness for small business operators, there is a need to raise awareness of cybersecurity and the risks posed to businesses from cybercrime.” 

“Cybercrime costs the economy more than $1 billion annually and disproportionately impacts SMES. It is becoming increasingly important for SMEs to adopt and successfully implement digital technologies within a trusted ecosystem, secured by design that is both robust and resilient.” 


 

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Josh Needs

Josh Needs

AUTHOR

Josh Needs is a journalist at Accountants Daily and SMSF Adviser, which are the leading sources of news, strategy, and educational content for professionals in the accounting and SMSF sectors.

Josh studied journalism at the University of NSW and previously wrote news, feature articles and video reviews for Unsealed 4x4, a specialist offroad motoring website. Since joining the Momentum Media Team in 2022, Josh has written for Accountants Daily and SMSF Adviser.

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