A roundtable hosted by the Council of Small Business Australia and the Tax Institute yesterday prompted calls for next week’s Budget to include a $30 million tax break for small business.
Senior representatives attended the round table from government and industry, including Assistant Treasurer David Bradbury, shadow minister for small business Bruce Billson, and independent MP Rob Oakeshott.
Following the roundtable, Oakeshott called on the Treasurer to give small business a tax break worth $30 million in next week’s budget.
The Australian reported that the independent MP said there was no point delaying the “loss carry back” reform that would allow small companies to get a tax refund if they posted a loss after previously making profits and paying taxes.
Peter Strong, executive director of COSBOA, told SmartCompany the organisation supports Oakeshott’s call for the small business tax break and there was general interest in the proposal at the meeting.
“In this particular stage of the economy, and the cycle we are in, it is an absolutely changed cycle and to manage change you often make a loss, especially if you are purchasing equipment,” says Strong.
“To be able to carry those losses back is good; good for your confidence and good for your cash flow.
“[Oakeshott] has seen a number of businesses struggling and trading their way through it and to trade their way through they need some assistance.
“Loss carry back identifies those in greater need but it does not support bad business behaviour, it helps with planning and change management.”
Strong says the roundtable engendered “good debate” but he warned there were no easy solutions to the issues faced by small business.
“There was general agreement that, over the last 20 years, red tape had grown too much and small business people needed to be treated as people,” says Strong.
“There was talk about a definition of a small business entity, but we need to step slowly and not rush into it.”
“We all agreed the definition had to be around the fact that someone in small business is actually a person, so we talked about what that meant in the world of compliance and how to help people manage family’s involvement in the business.”
Strong says there is renewed interest by government in small business as “people have realised it has just gone too far”.
“We need to take red tape away not just in tax but also in workplace relations,” says Strong.
The system really has been designed for paymasters, not small business.”
Strong says the Fair Work Ombudsman found 26% of retailers were not compliant with the Fair Work Act however only 1.8% of those with a paymaster were non-compliant.
“This shows that the Fair Work Act is the problem, not the retailers,” says Strong.
Strong says COSBOA was not disappointed with a lack of concrete results stemming from the roundtable as the organisation was not expecting any results, instead “we got issues out on the table that have not been out there before.”
Cara Waters is a former SmartCompany editor. Previously, Cara was a senior reporter for the Financial Times’ website and worked for The Sunday Times in London.
