87% of Australian businesses believe that the Australian economy is declining or coming to a halt.
The latest findings in the Sensis Business Index (SBI) survey reveal that the net balance score is down five points this quarter to -22.
Sensis CEO John Allan said that confidence in the retail sector has taken a major hit particularly for small to medium businesses.
“More than three times as many businesses think the economy is slowing as those who think it is growing.
“The projections for the economy in a year’s time have also deteriorated by 13 points, moving from positive to negative territory.”
Allan also said that despite a surge in confidence following last year's leadership spill have dipped significantly.
“The halo effect of the new Prime Minister seen last survey appears to have now evaporated however.
“In the December survey 8% of SMBs spontaneously mentioned the new Prime Minister as having a positive impact on their perceptions, but that figure is now less than 1%."
Allan suggests that tax incentives has acted as a double-edged sword for Australian businesses.
“Tax incentives are a growing influence on those with a positive assessment, while excessive red tape is the key concern of those who are worried.
“Positive wages and prices results helped influence confidence, while on the other hand there were negative ratings for sales, employment and profitability.
"A lack of work or sales again dominated as the key concerns for SMBs, while half reported barriers to taking on new staff.”
The survey also indicates that New South Wales has overtaken Tasmania as the most confident region in the Australia, while Western Australia has seen a colossal 20 point decrease.