With the Business Council of Australia recently commenting that Australia’s company tax rate is globally uncompetitive and should be reduced immediately, new research from MYOB echoes this sentiment revealing that over half (56 per cent) of small businesses agree that the company tax rate should be cut for Australia to remain globally competitive.
The latest SME Snapshot from leading cloud accounting provider, MYOB, has showed that 53 per cent of the 400+ SMEs surveyed were more likely to invest back into their business if the company tax rate was lowered. Simplifying the GST/BAS tax was likely to have a similar effect at 49 per cent.
“It was encouraging to see the government lower the company tax rate to 28.5 per cent for businesses with an annual revenue of $2 million or under in last year’s budget. However, company tax affects businesses of all sizes. The current system discourages SMEs to grow beyond $2 million in revenue because they then lose many of the benefits of being a small business. These barriers to growth need to be removed.”
“When we asked Australian SMEs what they would do with financial savings from a company tax rate cut, just under half (48 per cent) of respondents said they would keep this money to increase their financial position and weather any future business challenges,” said Tim Reed, CEO of MYOB.
This finding aligns with previous MYOB Business Monitor survey results.
This month’s SME Snapshot also asked small businesses if they were investing in innovation. While the vast majority of SMEs (85 per cent) agreed that Australia needed to embrace innovation to deliver success, only 4 per cent of those surveyed admitted to investing a set dollar amount towards innovation.
“We are seeing that Australian SMEs are struggling to invest in innovation. However, knowing that 36% of business owners would use a cut in the company tax rate to invest more in their business is certainly encouraging. Australia needs its economic engine room firing on all cylinders, and having small and medium businesses invest more will go a long way to securing our prosperity.” explains Mr Reed.
For further comment or other information please contact:
Sarah Beyrath; ANZ PR & Corporate Affairs Manager, MYOB
P: 02 9089 9043 / M: 0427 223 841 / E: Sarah.Beyrath@myob.com
Louise Halloran, Ogilvy PR
P: 02 8437 5397 / M: 0407 044 727 / E: Louise.Halloran@ogilvy.com.au
MYOB Group Ltd (ASX: MYO) is a leading cloud based business management solutions provider. It makes business life easier for approximately 1.2 million businesses across Australia and New Zealand by simplifying accounting, payroll, tax, practice management, CRM, job costing, inventory and more. MYOB provides ongoing support via many client service channels including a network of over 40,000 accountants, bookkeepers and other consultants. It is committed to ongoing innovation, particularly in cloud computing solutions, and in 2015 was awarded the BRW award for the most innovative large company for 500+ employees and placed 2nd in BRW’s Most Innovative Companies Award list across all categories nationally. For more information, visit http://investors.myob.com.au/Investors or follow @MYOB on Twitter.
About the MYOB SME Snapshot
First carried out in July 2015, the MYOB Snapshot is a monthly online survey of a section of MYOB’s 1.2 million customers. The survey provides the opportunity to quiz SMEs about topical issues and their responses to business conditions.