Published on the 02/06/2017 | Written by Newsdesk
Could there be any better impetus for a startup than easier regulation and a favourable tax regime?...
Those gathered at the recent Small Business Association of Australia (SBAA) Summit have tackled a tax regime described as ‘a complex minefield for small and medium enterprises and in most cases, a major cause of small businesses failing’. The organisation also proposed a three-year tax free period for startups, saying this would reduce overhead for the Australian Tax Office while also being unlikely to hit revenue as most businesses aren’t profitable at the early stage. Such a regime could benefit startups of all stripes, including tech based ones.
The organisation said in a statement that ‘it is clear…that the tax system is far too complicated and is currently expensive in both time and money to manage, resulting in the hindering success for small business, and that this needs to change’.
Small businesses have the same tax regulations as large business but often not the resources nor the time or knowledge to manage it, the organisation added.
Anne Nadler, SBAA CEO proposed, “The time is now to drive change. If small business succeeds then the economy succeeds and we need to build a system where people can create their own wealth.”
She added, “We are falling behind by world standards as to how we are being assisted by government. We are incredibly capable, however we are struggling through regulation and the high cost to do business.”
Anthony Cerantonio, principal, Forensic Accounting Group said, “If we don’t address this then we are failing small business in this country. We need to be here to give small business owners the right tools and the best advice to succeed.”
His solution is the proposal of a three-year tax-free moratorium for all start-up businesses. “It won’t cost the ATO a lot as most businesses first three years have carried forward losses – the ATO will not lose out.”
A representative of the ATO acknowledged that tax is very difficult to understand; Lionel Barden, Butler Hardy Corporate MD proposed, “As a group, we must unite to put plans together to take to Treasury to enact real change. We must protect small business who find this as a real issue.”
A further proposal was to make the process of acquiring an Australian Business Number as simple as getting a driving license, where responsibilities and obligations are learned prior to being issued an ABN. Yet others were to reduce regulations to give small business owners more time to focus on organisational development rather than red tape.