The federal government announced its budget, which included several measures aimed at small and medium-sized businesses (SMEs). Some of these programs, on the other hand, are not exactly what small businesses need to thrive. A national survey shows the priorities that small and medium businesses need the government to focus on.
How does the budget compare to what SMEs requested?
The key Federal Budget programs aimed at small and medium businesses are mentioned below, combined with whether small and medium business owners wanted the government to support the initiative. The information is derived from a study of 1257 Australian small and medium-sized businesses published as a component of Scottish Pacific’s March 2019 small and medium-sized businesses growth Index.
- Above everything, SMEs yearn for tax cuts for their businesses according to the small and medium-sized businesses growth Index. According to the report, the new Federal Parliament should concentrate on, company tax cuts. Therefore, tax concessions for small businesses are being implemented according to Scottish Pacific CEO Peter Langham, and he believed this is something which will be welcomed by the industry, as this was the top proposal SMEs wanted to see. 27% of company owners cite this as a top priority. One out of every five SMEs wants the recently appointed government to make reducing administrative and regulatory burdens a priority.
- Asset charge-offs are a boon for businesses. Almost a quarter of respondents said the Federal Government’s top priority for SMEs should be to continue asset write-offs. However, Mr. Langham states that they would be please with the budget’s announcement of a 30,000 dollars instant asset write-off up from 25,000 dollarsand the expansion of the program to include SMEs with up to 50 million dollars in revenue up from 10 million dollars.
- A $2 billion securitization fund has establish to help small businesses get access to capital. This statement by the government would have no effect on business owners on the ground. According to the SME Growth Index, only a small percentage of business owners believe this should be the government’s top priority for SMEs. Even though the announcement of a 2 billion dollars Small Medium enterprise (SME) lending fund earned a lot of coverage. Only 3% of respondents felt it should be the predominant concern, according to Mr. Langham.
What does this mean for small and medium-sized businesses?
Mr. Langham, the CEO of Scottish Pacific, stated that SMEs required government to work on issues that concern them daily. Rather than large-scale schemes like the NBN or small business financial support. Over the last six years, the small and medium-sized enterprise growth Index has consistently stated that lowering company taxes and reducing regulatory burdens are the most urgent changes SMEs are seeking. These are the low-cost products that will energize SMEs, stimulate business investment, and propel development and innovation. Mr. Langham believes the Federal Government’s efforts to simplify BAS are beginning to bear fruit. However, only 1 out of every 10 SMEs listed more BAS simplification as their top priority in this latest survey, down from 1 out of every 4, 18 months ago.
To conclude, though the federal government has released its budget, which includes a number of initiatives targeted at small and medium-sized enterprises (SMEs). However, some of these services are not necessarily what small companies need to succeed. Thus, it is important for the federal government to make some changes so that it benefits the SMEs.