Summit says tax system can be simplified for small business

DAY two of the Small Business Association of Australia Summit commenced with a powerful discussion on our current Tax System and how it is a complex minefield for Small and Medium Enterprises (SME’s) and in most cases, a major cause of small businesses failing.

Channels were open at the Summit with Small Business Owners and representatives from the ATO, Fairwork Australia and independent speaker Kate Carnell, AO, Small Business & Family Enterprise Ombudsman and it was clear through the robust and frank discussion that the tax system is far too complicated and is currently expensive in both time and money to manage, resulting in the hindering success for small business, and that this needs to change.

Small businesses create massive wealth for Australia through tax but they have the same tax regulations as large business but often not the resources nor the time or knowledge to manage.


Anne Nadler, Founder/CEO Small Business Association of Australia proposed, “The time is now to drive change. If small business succeeds then the economy succeeds and we need to build a system where people can create their own wealth.”

She added, “We are falling behind by world standards as to how we are being assisted by government. We are incredibly capable however we are struggling through regulation and the high cost to do business.”

It was benchmarked that creating change for small business is critical, and proposing a system whereby creating wealth, which also stimulates economic spending, and simplifying tax and regulation is the key to move forward.

Anthony Cerantonio, Principal, Forensic Accounting Group said, “If we don’t address this then we are failing small business in this country. We need to be here to give small business owners the right tools and the best advice in order to succeed.”

He added, “I feel that it would be a smart idea to propose a three-year tax-free moratorium for all start-up businesses. It won’t cost the ATO a lot as most businesses first three years have carried forward losses – the ATO will not lose out.”

Each and every delegate agreed that they wish to propose a tax freeze for start-up small business and this was crucial in assisting small business. They also agreed that uniting to create change is essential.

It was agreed by a representative of the ATO that they understand that tax is very difficult to understand and that they are focused on assisting small business and on them succeeding.

Taxation laws are set by Treasury, and Lionel Barden, Managing Director, Butler Hardy Corporate proposed, “As a group, we must unite to put plans together to take to Treasury to enact real change. We must protect small business who find this as a real issue.”

One proposal, was to set the process of acquiring an ABN as similar as to getting a driving license, where responsibilities and obligations are learned prior to being issued an ABN. Others were to reduce regulations to give small business more time to focus on their business rather than red tape.

It was agreed within the forum that SMEs feel they require more assistance from the ATO, and while dealings with the ATO for most had been positive, there is a need to better understanding and transparency from both side to navigate the regulations.

Kate Carnell -Australian Small Business and Family Enterprise Ombudsman was in attendance for the session and raised, “The Ombudsmen’s office is set up to provide support for just these matters such as ATO issues with small business.”

She stressed that the ATO is more than welcoming to enter into providing payment solutions and arrangements with Small Business, and that it was essential to open the lines of communication between them and small business.

All delegates are encouraged to provide a paper in the coming weeks of their proposals for change, which will form the basis of the Tax Pillar of the proposed Small Business Charter.

Further information to come out of the second day of the Summit included;

The Legal System simplified for SMEs highlighted that while the legal system is robust, it is often difficult for small business to gain access to. There is a huge imbalance between large and small business and its incredibly complicated and expensive for small business to engage legal services.

Both Kate Carnell, Australian Small Business and Family Enterprise Ombudsman and Greg Jennings, Director Proactive Compliance and Education encouraged the delegates to consider the use of their organisations. It is the role of their respective offices that they are available to assist and provide advice and encourage small business to use them as a resource.

The topic Manufacturing in Australia drew a lot of attention, the Summit believed that there is no formal education in this country for manufacturing, the country is an expert in so many areas as purchasing, packaging, distribution, research and development, logistics, plant equipment, capital raising, we can manufacture in Australia but we should focus on quality not quantity as we find it difficult to compete with overseas.