The “highly anticipated” tax cut for small businesses will provide much needed relief for owners, says Kate Carnell
An Australian Small Business and Family Enterprise Ombudsman (ASBFEO) report shows the amount of tax paid by the small business sector overall has increased, while the contribution made by big business has fallen.
The ASBFEO’s Small Business Counts statistics report includes ATO figures showing the small business share of company tax revenue has increased 2% in recent years, while input from the big business sector has fallen 3%.
“A healthy small business sector is a prerequisite for a growing economy; there’s no doubt small businesses are doing their fair share when it comes to paying tax, not to mention creating job opportunities,” ASBFEO and former pharmacist Kate Carnell says.
“The Federal Government’s foreshadowed company tax cuts for businesses with a turnover of up to $10 million will give 99% of Australian businesses a tax reduction, and will provide a much needed shot in the arm for the sector’s growth prospects, enhancing the ability of small businesses to employ,” she says.
Compiled over the past 12 months, the ASBFEO statistics report brings together data and analysis from a range of sources including the ATO, ABS and Austrade, and has been released to mark the office’s one year anniversary.
“This report… ultimately reinforces the size and importance of the small businesses to the Australian economy, and outlines its growing diversity,” Ms Carnell says.
Among the report’s findings, Ms Carnell says the number of small businesses currently venturing into offshore markets is on the rise.
“Encouragingly, ABS data shows more and more small businesses are entering export markets, with 44% of goods-exporting firms classified as small business,” Ms Carnell says.
“Many are also entering the global market place at an early stage of their development, giving rise to the ‘born-global’ phenomenon.”
Ms Carnell says while many small businesses are at the cutting edge of innovation, she’d like to see more small businesses go down this path.
“Our report highlights ABS data showing small business accounts for 17% of business expenditure on R&D; while this is encouraging, it’s a figure I think the sector can – and will – build upon, particularly as more small businesses realise the benefits of entering into strategic partnerships with larger companies, especially in industries like defence,” Ms Carnell says.
Ms Carnell is inviting feedback on the report and says she welcomes comment from small business and others.
The full report can be found on the ASBFEO website.