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Cost-of-living measures, energy subsidies and other initiatives will help, it says, but much more could have been done.
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Small business laments lack of targeted support for sector
11 May 2023
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Small business has cautiously welcomed many of the budget measures but said more needed to be done with initiatives focused on encouraging productivity, employment and growth in the sector.
Representative bodies for the sector also highlighted what was missing from the budget and concerns over particular measures.
The Council of Small Business Organisations (COSBOA) said the three-year transition to payday super had to be “thoroughly considered with appropriate funding of the technology changes”.
“This is not a no-cost proposal and it is not a ‘just push the button’ solution,” COSBOA chair Matthew Addison said. “A better, efficient, more correct solution for small business would be a move to monthly payments.”
He welcomed the instant asset write-off extension for small business (for assets up to $20,000 and for businesses with a turnover less than $10 million) but urged the government to consider extending eligibility for full expensing, which ends this financial year, for equipment ordered but not yet installed.
Mr Addison said details were still required on the $650 subsidy for small business energy bills while the 120 per cent tax deduction for energy-efficient equipment was “a good start, but more is needed”.
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He also said the sector needed “least cost routing” to be mandated to lower debit card transaction fees, called for the implementation of e-invoicing and more funding for training and skills development.
However, he welcomed support for COSBOA’s CyberWardens program, which gets $23.4 million over three years to help create up to 60,000 cyber wardens to protect against digital threats.
The Australian Retailers Association (ARA) welcomed the cost-of-living relief in the budget because discretionary spending was crucial to the sector and it was beginning to soften “significantly”.
ARA CEO Paul Zahra said measures such the $20,000 instant asset write-off, energy bill relief and the new Small Business Energy Incentive would also help reduce costs.
Other welcome initiatives included the Industry Growth Program, which provides $392 million over four years to support Australian SMEs and start-ups commercialise their ideas and would “help put some exciting new ventures on the map”.
Also a positive were reforms to migration which would help address labour and skills shortages.
“The red tape of Australia’s migration system and the barrier of expensive childcare are two leading drivers of high job vacancies,” he said. “We are pleased to see the commitment to cut the cost of childcare for 1.2 million families – together these measures will have enormous benefits for retail and the broader economy.”
However, Mr Zahra said the “permanent state of disruption” in retail meant small business would need further support.
“We’re ultimately experiencing a crisis in the cost of doing business, and small businesses are bearing the brunt of this,” he said.
“Energy costs are just one of the higher costs of inputs that businesses are currently managing. Businesses need more support managing higher labour, leasing and supply chain costs as well as insurance.”
The Australian Small Business and Family Enterprise Ombudsman (ASBFEO) said the raft of budget measures for small business were a step towards delivering a stronger economy.
As well as the energy subsidies and asset write-off schemes it highlighted the reduction in PAYG and GST uplift from 12 per cent to 6 per cent for FY2023–24, extending the period for small businesses to amend income tax returns from two to four years, and $18.1 million to assist the sector in competing for government tenders.
Other positives included the Industry Growth Program, support for small enterprises to adopt AI, and an ACCC complaints mechanism for small business to raise systemic issues.
But Ombudsman Bruce Billson said it was disappointing to see a reduction in support for the underpromoted Self-Employment Assistance Small Business Coaching program and the Entrepreneurship Facilitators Program.
“These programs have low awareness and can help with the success and durability of many of the 1.6 million Australians who derive their livelihoods from self-employment and make a vital contribution to the economy.”
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