NT SMEs sceptical about Labor’s small business tax cut
Friday, August 16, 2013/
While Labor has attempted to bump its business credentials on the campaign trail by promising the Northern Territory a business tax cut of 10 percentage points, local employers aren’t so enthusiastic.
Greg Bicknell, chief executive of business group Chamber NT, told SmartCompany this morning the organisation is “slightly cynical” about the plan.
The other states are, too – business groups in Victoria and around the rest of the country have already complained the government is playing favourites.
He says the announcement was just the latest in a long string of political promises.
“We’ve heard talk of plans for the Northern Territory coming since 1937, and we’ve yet to see any long-term strategic thinking and action.
Prime Minister Kevin Rudd announced the plan yesterday, saying the territory would receive a 10 percentage point cut in the company tax rate within five years. The Northern Territory would also be incorporated as part of a special economic zone – a plan which has also been endorsed by billionaire Gina Rinehart.
”I believe in the Territory, I love the Territory,” Rudd said.
However, the tax cut has not yet been costed, and as Bicknell says, there is no current plan for how the cuts will be targeted.
“There’s just not enough detail,” he says.
“Obviously, if it applies to everyone across the board, business would welcome that. But if it’s only for newcomers and putting existing companies at a disadvantage, we wouldn’t welcome it.”
In theory, Bicknell says, the cut is a good idea, and he welcomes the fact both sides of Parliament are paying more attention to the north.
But for now, he says, “we’re slightly sceptical”.
“There is a lot of talk about the Northern Territory…but the delivery of the promises seems to get lost.”
Meanwhile, however, other business groups and politicians have expressed frustration with the announcement.
The Victorian Employers’ Chamber of Commerce and Industry said if the announcement is good enough for the Northern Territory, it should be good enough for the rest of the country.
“Making the Northern Territory more attractive due to its company tax rate will be at the expense of Victoria and other states,” chief executive Mark Stone said in a statement.
The WA Chamber of Commerce and Industry has a made a similar statement, with chief executive James Pearson telling the ABC that any plan to boost the attractiveness of northern Australia “has to include Western Australia”.
This story first appeared on SmartCompany.