Federal Budget 2022


21st October, 2022

Federal Budget 2022-23: Business owners flag tax cuts, skills as priorities

A few days before the ALP hands down its first Budget, business owners have called out taxation and staffing pressures as the major items they’re hoping the Government can address.

Australian small business owners have underscored the pressures they’re facing and called out the major items they’re hoping the Government will deliver as part of the upcoming Federal Budget announcement.

The Budget, the first to be delivered under Prime Minister Anthony Albanese, will be handed down by Treasurer Dr Jim Chalmers in Canberra next Tuesday 25 October.

If you’re feeling like it wasn’t that long since we had a Budget announcement, you’re not wrong — this will be the second Federal Budget of 2022 following the former Morrison Government’s Budget in March (it’s not uncommon for a new Government to use the Mid-Year Economic and Fiscal Outlook, or MYEFO, as an opportunity to deliver a second Budget in election years).

While the Final Budget Outcome for 2021–22 revealed a windfall for the economy because of rising prices, the impending threat of a Global Recession means Chalmers’ first Federal Budget will aim to provide targeted support without further encouraging inflation.

READ: What can businesses expect on 25 October?

But what do Australians themselves wish to see addressed? To answer that question and more, MYOB turned to a panel of 847 consumers and 257 small and medium business (SME) owners across the nation, presenting the results in a new report.

Highlights of the MYOB Federal Budget Snapshot:

  • 88% of all respondents are feeling the effects of rising costs and inflation
  • 93% of all respondents believe small business support is important for economic prosperity
  • 33% of consumers don’t believe this Budget will deliver small business support

“At a unique time of post-COVID recovery and global fiscal uncertainty, securing the growth of Australia’s 2.5 million small and medium-sized businesses (SMEs) — and the opportunities for the more than 7.6 million Australians they employ — will be essential futureproofing for our economy,” said MYOB Chief Employee Experience Officer Helen Lea, writing in the foreword of the report.

“At MYOB, we know SMEs are the lifeblood of the Australian economy — and the figures show most Australians agree with us.”

What are small business owners looking for in the Federal Budget?

The tail end of a global pandemic has created an environment of uncertainty and high costs for individuals and businesses, with MYOB’s new report sizing up the challenge.

Thirty-four percent of SME respondents said they made less revenue because of rising costs, with 27 percent saying they’d passed costs onto their customers.

A case in point for these cost pressures is cybersecurity, which business operators see as a necessary but prohibitive cost to doing business.

In fact, 66 percent of business operators believe they need to invest more into cybersecurity, while 37 percent indicate the cost of these protections are a key barrier to investment.

And when it comes to the Government’s investment priorities that would support small businesses, SME respondents were clear: tax reform, more workers and less bureaucracy remain at the top of their lists.

Top 5 investment priorities SMEs are seeking in the Budget:

  1. Tax reform (49%)
  2. Incentives for apprenticeships and vocational training (42%)
  3. Financial incentives for hiring staff (39%)
  4. Cutting of red tape (36%)
  5. Incentives for digital training (30%)

These priorities indicate what’s on the minds of small business operators, but they’re also echoed by sentiment from the wider public, with all respondents seeking measures to boost skills and workforce participation.

The report shows 62 percent of all respondents agree that Australia has a productivity issue that could be addressed by support to upskill workers (66 percent), free tertiary education for in-demand professions (58 percent) and increased opportunities to encourage women to return to work after having a child (48 percent).

Every dollar invested into digital to return $25 for economy

As in the case of cybersecurity, both business owners and consumers see digitisation as a possible solution that will assist in maintaining productivity in an era of rising costs.

Thirty-five percent of all respondents view the use of digital tools as important when boosting productivity, while 28 percent of SMEs still struggling to access a stable internet connection.

“Our modelling shows increasing SME access to technology and digital skills could bring an additional $10.5 billion into the economy,” said Lea.

“The Government’s recent proposed measures targeting SME technology investment and access to skills (the Technology Investment Boost and Skills and Training Boost) are a necessary step towards supporting SME growth and enabling the sector to protect itself from external pressures.

“Our modelling shows every dollar invested by the Government to support SMEs to adapt and adopt technology would generate a $25 return to the economy, through productivity gains and job creation.”

Take a deep dive into what business owners, operators and consumers are thinking ahead of next week’s Budget announcement with the MYOB Federal Budget Snapshot report. Download it FREE today.