Published in The Sydney Morning Herald
Small business thrives in Australia because of the inherent Australian desire to "have a go".
That entrepreneurial spirit sees more than 2.1 million actively trading small businesses in Australia. Small businesses employ more than 4.8 million Australians, that's almost a half of Australia's private sector industry employment. Small businesses contribute 34 per cent of private sector industry value add.
The Australian Government is delivering policies to ensure small business retains its dynamism and agility.
Our small business policies and service delivery focus is straight-forward. It is based on the sound principles of ensuring small business is able to operate in genuinely competitive markets, is freed as much as possible from the demands of red tape, and has access to appropriate direct support and advisory and training services.
Our programs and reforms are designed to assist small business in other ways too, for example by increasing cash flow.
We are doing this through initiatives like the increase in the instant asset tax write-off threshold and loss carry back. Our changes to the instant asset write-off threshold will be worth an estimated $1 billion to small business in 2013-14 alone. This initiative allows small businesses to immediately write off the cost of asset purchases under $6,500, including motor vehicles, and depreciate other assets, other than buildings, at 15 per cent in the first year and then in a single pool at 30 per cent. Up to $5,000 can be immediately written off for motor vehicles costing more than $6,500, with the remainder to be written-off in the single pool (15 per cent in the first year and 30 per cent in following years).
From the 2012-13 tax year, companies will be able to carry back up to $1 million worth of losses to get a refund of tax paid in the previous year. This will support businesses when they need it most and encouraging them to invest and adapt by using their tax losses now, rather than in the future.
Personal income tax cuts through our changes to the tax free threshold, lifting it from $6,000 to $18,200 from last July, and to $19,400 from 1 July 2015, are also benefiting many small business owners and their employees.
The Australian Government believes in the importance of nurturing its small business suppliers. It understands that late payments have a knock on effect, constraining small businesses. That's why we are setting an example for private enterprise and other levels of government by paying almost 97 per cent of invoices from small businesses within 30 days.
We recognise that small business has the agility to innovate and accordingly we have made investing in research and development easier and more attractive through the R&D Tax Incentive by offering a 45 per cent refundable tax offset for R&D for eligible SMEs, with the refunds available as quarterly credits from next January.
The Australian Government is also continuing with its agenda to reduce red tape for business, in particular for SMEs.
Our $125.2 million investment over four years in a national system for registering business names and initiatives complementing this, has been highly successful. It is administered by the Australian Securities and Investment Commission, which has received more than 190,000 business name registrations, since the system came on line on 28 May 2012.
The national registration system has slashed red tape and the cost of business name registration by replacing separate state and territory services with a single system. It is complemented by a new online account to help businesses manage online interactions with all levels of government through the Australian Business Account, and the Australian Business Licence and Information Service helping businesses find all the licence, permit, registration, codes of practices, standards and guidelines they need to meet their compliance responsibilities.
It is important that small business operators, who are often time-poor, are able to access appropriate advisory services and support in a variety of ways. That's why we continue to enhance our highly successful online portal, business.gov.au to make it easier to find information and advice from all levels of government to help to start and grow a small business.
It's why we operate the Small Business Support Line with skilled advisers, and the Independent Contractor's Hotline, to give operators access to information and referral services. And it's why we are providing a further $27.5 million to extend the Small Business Advisory Services program over four years through a wide selection of business advisory organisations, with on-going funding thereafter.
The Australian Government is determined to ensure that small businesses are given adequate voices when it comes to decisions that affect them. We have appointed the first Australian Small Business Commissioner, Mr Mark Brennan, who has a strong track record as an advocate for small business to the post. His is a dual role, as well as providing a further avenue to information, assistance and referral services like business advice and dispute resolution, the commissioner will speak directly to the Government on matters affecting small business.
Finally, the Australian Government brought the Small Business Minister into Cabinet for the first time in a decade giving small business a direct voice in the big issues that affect businesses.
I want to reassure you that the Australian Government is committed to ensuring that small business continues to operate in a strong and resilient economy and to continuing to seek formal and informal dialogue, directly and indirectly, with small business at a peak body level and individual small business operators.
Media contacts: Minister's office 02 6277 7930