Small business representatives have called on the Federal Government to do more to help SMEs deal with the economic downturn at a special COSBOA forum in Melbourne this morning.
But Federal Small Business Minister Craig Emerson has rebuffed suggestions such as a freeze on payroll tax or capital gains tax relief, claiming the effects on Government revenue would be too great.
Emerson told forum representatives the Government is working to help small businesses by eventually developing a “seamless national economy,” with more co-operation between state and federal governments.
But he did not announce any new programs or spending initiatives – and business owners and representatives are unhappy.
Ron Patterson, national sales manager for the Printing Industries Association of Australia, says: “Government is just not aware of what’s going on in the street. I think a lot of the time they just don’t understand.”
But Patterson also says the COSBOA forum is a positive step, as it “keeps the Government on their toes”.
Steven Wright, executive director of the Franchise Council of Australia, says the Government is in danger of being overshadowed by the Opposition’s approach to small business.
“The Opposition has elevated small business to a cabinet position. We applaud that,” Wright says. “On the whole, the Government just needs to be doing more.
“The Government also needs to ensure lending is continuing to occur… we need to get most of those rate cuts passed on to small business,” he says. “On the whole, they just need to be doing more.”
But Emerson says the Government is aware small businesses are under pressure. “We’ve always had in mind small businesses are at the front of any shock wave.
At the forum he repeatedly stressed the importance of ensuring businesses have access to credit.
“We need productivity growth… as important as the interest rates are, so is the flow of credit to small business.”
But Emerson dismisses calls for payroll and capital gains tax relief by Australian Hotels Association national affairs director Bill Haley, saying the drain on Government revenue would be too great.
“Businesses wouldn’t [take a cut in revenue], households wouldn’t do it, and governments cannot do it,” he says.
“Businesses that want a tax holiday just never want the tax holiday to end.”
In a sometimes tense meeting, Emerson heard a number of concerns from the floor.
- Emerson has joined economists worldwide in announcing the “western world” is now in recession except for Australia. He says Australia’s small businesses remain “resilient, tough and fairly guile.”
- Emerson dismissed calls for a national retail leasing code from the Franchise Council of Australia. “I don’t like the idea,” he says.
- In a tense discussion between Emerson and Australian Retailers Association chief executive Richard Evans, Emerson denied any knowledge of how unit pricing affects small business. Evans repeatedly called for the Minister to “let the market decide” the issue.
- Evans also addressed representatives at the forum, claiming negative rhetoric will only reduce consumer confidence further. “It’ll feed on itself and devour itself. Don’t put the negativity out there,” he says.
- Intellectual property experts claim the higher cost of lodging patents through a third-party attorney is decreasing Australia’s level of innovation. Emerson promised to take the matter into consideration.
Tax office representative Mark Elwell says the tax office will be taking note of all suggestions put forward during the forum.
“This is just a good opportunity to hear small businesses, and from an ATO point of view, we need to hear what they are concerned about.”
Elwell says the tax office will “consider everything” put forward at the summit.
“We need to be working with businesses to help them survive.”
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