30 October 2018
We learned last week that the federal government is developing a suite of economic measures to boost small business, as Prime Minister Scott Morrison prioritises smaller companies ahead of the “big end of town” entering the election race.
The policies being worked on include boosting access to funding for small business to overcome a purported credit squeeze, improved tax dispute resolution with the Australian Taxation Office and helping small companies get paid faster by large customers.
The government is considering a government-endorsed finance vehicle for small and medium enterprises (SMEs), similar to those in Britain and Canada, to make loans more available to SMEs. Another plan being considered is to help pool small business loans in a securitisation vehicle so investors such as superannuation funds can gain exposure to SME credit, again making such loans more accessible.
On tax, the new Assistant Treasurer is working on ways for small business to resolve tax disputes with the ATO in a simplified and streamlined fashion.
The Coalition has already committed to bring forward SME corporate tax cuts, as revealed first in September. At present, the tax rate for companies with annual turnovers capped at $50 million has been lowered from 30 per cent to 27.5 per cent. It is scheduled to drop to 25 per cent by 2026-27.
With such commitments coming from the very top, we continue to have very positive views toward the SME sector in Australia as businesses continue to prosper under favourable conditions.
By Lee Xie (Senior Project Manager)
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