Starting a business may feel like a solo struggle, but it may be of some comfort that smaller enterprises now have a representative at the top table of government for the first time in a decade.
Since being appointed federal small business minister in March, Brendan O’Connor had plenty to deal with from his seat in cabinet.
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We’ve had the establishment of a national small business commissioner, a proposal for a new corporate entity for small businesses and a federal budget that offered a few incentives to small businesses, but precious little in terms of start-up backing and the scrapping of the promised company tax cut.
O’Connor visited start-up co-working space The Hub last week to meet some of the up-and-coming ventures that now fall under his brief. He fielded questions from the assembled businesses, as well as from StartupSmart after the event.
Here are some of the minister’s answers to the pressing issues faced by new businesses.
What extra influence do you have in cabinet that your predecessors didn’t have before?
Well, I’ve got more influence than anyone else in this position over the last decade. There hasn’t been a small business minister in cabinet since 2001, which means that small businesses haven’t been able to advance their case within cabinet.
It also means that small businesses have had decisions made that are unintentionally adverse to them without someone there to speak up for them.
So I’ve got an opportunity to talk about small business issues, whether that’s getting advice, access to credit or other issues.
I don’t think the two main political parties have had a full appreciation of small business before.
The Liberals have had a few rhetorical flourishes, but then again they made small businesses unpaid paymasters by bringing in the GST.
We’ve had an explosion in business atomisation in Australia, companies set up with two or three people, and we traditionally haven’t catered for them.
These businesses have done well without too much assistance, but our job is to create an environment that will help them thrive and grow further.
What has been your reaction to the small business anger regarding the lack of a budget tax cut?
While I understand that some small businesses and peak bodies would like to see a lower company tax rate, I haven’t seen “anger” about it at any of the public forums I have attended since the budget.
The fact is that the Liberals and the Greens had joined together to stop us delivering that cut.
The Liberals say they were opposed to it because it was funded through the minerals resource rent tax, which we are using to spread the benefits of the mining boom across the economy.
However, I note that Tony Abbott does not apply the same alleged principled opposition to using the mining resource rent tax revenue for our family payments.
We decided not to engage in a pointless political exercise that would end in parliamentary gridlock.
Instead, we decided to use that money to help families and businesses which are finding the going tough now and, importantly, improving consumer and business confidence.
It is still our intention to provide company tax relief, and we will be working with the Business Tax Working Group to come up with a tax cut that will have the support of the Parliament.
And we are introducing a number of tax measures that will assist small businesses – the instant asset tax write-off, the loss carry-back scheme, and trebling the tax-free threshold from $6,000 to $18,200.
Small businesses will also be able to claim up to $5,000 as an immediate deduction for motor vehicles (new or used) which cost $6,500 or more.