R&D Tax Credit
The research and development tax credit is keeping a lot of tech companies in Australia, according to Fox and he is worried the tax credit may be cut.
“It’s tough being a tech startup in Australia particularly around raising capital,” Fox says.
“It’s tempting for businesses like ours to move to the US but one of the things that helped keep us here was the R&D tax credit.”
Fox says the R&D tax credit is crucial to Shoes of Prey as it helps fund its software engineering research and development costs.
The export market development grant
There is concern grants available to business to assist with exporting are going to be axed in the budget after the grants were included in the National Commission of Audit’s hit list.
Fox says he is concerned the export development grant will be cut.
“That program is really helpful to help us fund our export marketing costs,” he says.
The export market development grant is a five year program and this year is Shoes of Prey’s last year in the program, so Fox says it is the impact on other Australian exporters that he is concerned about rather than his own business.
Commercialisation Australia
Fox has heard “rumblings” Commercialisation Australia will have its funding cut in this year’s budget.
“That’s already been incredibly frustrating for us. We put in an application for a grant in November,” he says.
“We were supposed to find out in March if we were successful, but the government has put the whole project on hold pending the budget.”
Fox says applying for funding from Commercialisation Australia has been a “huge amount of work” which will all be completely wasted if it is axed in the budget.
“It took two or three weeks full-time for me as the chief executive and that much time again from other people in the business to prepare the application,” he says.
“It’s an in-depth application, so it’s not really something I could delegate.”
That will be very disappointing if it is cut.
Child Care Benefit
With “a business full of women”, Calder will watch the budget with bated breath to see if the Child Care Benefit gets cut.
“Getting rid of the Child Care Benefit is a concern to me as it is very helpful to working mums and dads who without that money will be in real financial hardship,” Calder says.
“If as a country we want to encourage population growth [the Child Care Benefit] actually helps as it makes child care more affordable.”
Superannuation incentives
Working in the finance sector, Calder is worried about superannuation adequacy in Australia and says it will be shortsighted of the government to abolish any incentives for superannuation in this year’s budget.
“Statistics say that even the 12% [of salary being paid into superannuation] isn’t enough,” Calder says.
“Anything that removes incentives to save into superannuation is a problem.”
Calder says the reality is that for most demographics there is going to be a superannuation adequacy issue.
“This is a particular issue for women who have broken workforce participation and lower incomes,” she says.
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.
