Taxes causing headaches for SMEs on hiring

New survey data from Bentleys reveals the tax system is hindering the ability for SMEs in Australia to employ new staff.

New survey data from Bentleys reveals the tax system is hindering the ability for SMEs in Australia to employ new staff.

Bentleys’ The Voice of Australian Business survey, asked SMEs from metro and non-metro areas across Australia about the challenges they face in regards to tax in Australia, business confidence and employment outlook.

 

According to the survey, one in five businesses (21 per cent) say business taxes have a ‘substantial’ impact on their ability to employ new staff, while the same amount find taxes ‘extremely’ or ‘very’ hard to understand.

 

The results show the most vulnerable businesses in the sector are ‘micro’ businesses (those with less than four staff), as well as businesses based outside of major metropolitan cities. One third of micro businesses and 26 per cent of non-metropolitan businesses said they were worried about business prospects in the next 12 months.

 

As well as effecting SMEs ability to employ new staff, 15 per cent of businesses say that business taxes have a ‘substantial’ impact on their ability to upgrade working tools or equipment, and 14 per cent on their ability to upgrade working premises. Other findings from the survey include:

 

- 72 per cent of businesses said they would not support an increase in the rate of GST, even in the context of potential reductions in Corporate and Income Taxes

 

-50 per cent of businesses support the repeal of the Carbon Tax; slightly less support the repeal of the Mining Tax (41 per cent).

 

-  58 per cent of businesses were opposed to the lack of GST applied to purchases from overseas companies.

 

Nick Storer, Director and Chairman, Bentleys, said these results show tax and compliance issues are causing SMEs considerable concern, and in the case of many micro and non-metropolitan businesses are hindering growth and employment.

 

“It is vital that many areas of tax legislation – such as payroll and superannuation requirements – are made simpler and more consistent to foster business,” Storer said. 

 

“SMEs are fearful of the continual changes made to the tax system. Government must take greater note of the concerns and issues that SMEs have with the current system and with proposed changes. A more consultative approach with all SMEs is needed, with particular focus on regional businesses.”

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