Last week, we commended Federal Treasurer Scott Morrison for recognising the important role small to medium businesses play when it comes to creating jobs for Australians into the future.
Given the high proportion of Small and Medium Enterprises (SMEs) within the retail sector, the proposed business tax cuts outlined in the budget provide a more supportive business environment for retail owners.
There are 87,000 SMEs in Australia – a large number of which make up the retail sector.
By extending the definition of a small business, to include firms with turnover up to $10 million per annum, the lower company tax rate is now available to many more firms. In addition, all firms within the expanded definition can take advantage of the accelerated depreciation rates on new plant and equipment. Tax incentives will also be provided to unincorporated businesses – this is great news for retailers wishing to expand or refit their stores.
Cutting their effective tax rate will support these businesses and their team members. We certainly hope that these proposed tax breaks will enable small to medium businesses to invest back into their own businesses, and create more jobs for everyday Australians.
This is good news for retailers, who have faced unprecedented competition from overseas retailers who aren’t facing the same cost imposts, such as; high award wages and penalty rates, restrictive trading hours, penalising lease agreements, as well as high business tax rates. SMEs are the heart of the economy and must be able to compete in order to create continuing employment opportunities, which in turns leads to economic growth for all Australians.
The inclusion in the budget of the “Youth JobsPATH” initiative seeks to help 120,000 young job seekers prepare for employment with the objective of reducing long term unemployment. The plan is to create an internship network which will be underpinned by job readiness training and access to substantial financial incentives for both job seekers and employers. As well as producing a direct social benefit, the scheme has the potential to improve productivity over time. This is great news for the retail industry, which continues to be the engine room for jobs for young Australians.
We also welcome the proposed move to lift the upper limit for the middle-income tax bracket from $80,000 to $87,000 to offset the effects of “bracket creep”. This will place an additional $315 into approximately 500,000 middle-income earners’ pockets each year, which we hope will have an immediate impact on consumer confidence.
When retail is flourishing, it drives productivity and jobs growth right across the country, and we believe a number of these measures will stimulate the retail sector considerably. Some changes are likely to take considerable time to implement, with some businesses having to wait some time to see the benefits of these changes.
In the meantime, we understand that it can be difficult navigating and keeping up with all aspects of a business in the age of online retailing and constant digital advancements. That’s why we offer an array of different training options for our members. To register for these upcoming training workshops or find out more information, head to the events section of our website.
When it comes to negotiating the workplace relations landscape, we know it can be challenging at the best of times. Even for seasoned professionals, keeping on top of changing award levels, junior rates, overtime payments, penalty rates and rostering requirements can be an enormous distraction from the job of running your business.
So don’t forget that the NRA is only a phone call way. Our in-house team is always ready to provide expert advice and help you navigate any challenge you’re facing. Give us a call on 1800 738 245.
Ian Winterburn, CEO, Deputy Chairperson