SMEs lead calls for company tax cuts

The latest SME Snapshot from cloud accounting provider MYOB has shown that 53 per cent of the 400-plus SMEs surveyed were more likely to invest back into their business if the company tax rate was lowered.

A reduction in GST/BAS tax was also likely to have a similar effect, with 49 per cent indicating their likeliness to reinvest.

“When we asked Australian SMEs what they would do with financial savings from a company tax rate cut, just under half [48 per cent] of respondents said they would keep this money to increase their financial position and weather any future business challenges,” said Tim Reed, CEO of MYOB.

“It was encouraging to see the government lower the company tax rate to 28.5 per cent for businesses with an annual revenue of $2 million or under in last year’s budget. However, company tax affects businesses of all sizes," Mr Reed added.

"The current system discourages SMEs to grow beyond $2 million in revenue because they then lose many of the benefits of being a small business. These barriers to growth need to be removed.”

According to Mr Reed, Australia needs its economic engine room "firing on all cylinders", with further encouragement for small and medium businesses to invest in their success.