Australian small business owners have reacted positively to key measures introduced in the recent Federal Budget, according to new research from MYOB.
In its monthly SME Snapshot survey, focusing on Australian SMEs’ reaction surrounding specific Federal Budget measures, it found that more than half (56 per cent) of small businesses said lowering the company tax rate to 27.5 per cent for businesses with up to $10 million in revenue will have a positive impact.
It also found that SMEs support increasing the instant tax write-off eligibility to include businesses generating up to $10 million in revenue. The survey found that 50 per cent of small businesses said this eligibility increase would benefit their business.
MYOB CEO, Tim Reed, said the results show that SMEs believe this overall eligibility increase will encourage growth within small businesses and the Australian economy.
“While this year’s budget has come under fire for favouring big business, the results show that the majority of Australian SMEs believe that lowering the company tax rate is an important reform and will encourage growth.
“For every dollar a small business spends with a big business, big businesses spend $2 with small businesses – it is an ecosystem and we need to make sure all parts are healthy,” he said.
The survey also revealed 72 per cent of SMEs agreed growth would be encouraged through widening the definition of a small business. Reed mentioned this move will result in SMEs feeling less restrained when it comes to planning for business success.
“It’s encouraging to see these barriers to growth removed. The previous system discouraged SMEs to grow beyond $2 million in revenue because they lose the benefits of being a small business.
“Small businesses often rely on bigger businesses as customers – without stimulating investment in bigger business, small businesses won’t receive the positive flow on effect.”
Small businesses were also asked if they were in favour of the reduction in GST codes from seven to three as part of the government’s BAS simplification trial. 47 per cent were in favour of the new measure.
SMEs were also asked how likely they would be to employ someone under the age of 25 years through the Federal Government’s new PaTH initiative. 31 per cent said they were likely or very likely to consider hiring a job seeker through this program. Younger business owners, under 40 years of age, were more likely (58 per cent) to use the program to hire young people.
“We all should be very encouraged by these results. If just a small portion of Australia’s SMEs took part in this new initiative and consider hiring a young Australian it will be a big success. There are nearly a quarter of a million young Australians out of work, so it is great to see SMEs becoming part of the solution to youth unemployment.
“With millennials set to define the future of the Australian workforce, we encourage small businesses to be a part of this internship program, and do what they can to create opportunities for the younger generation,” Reed added.