The 2014 budget, as it stands, is set to affect small and medium businesses (SMEs), however, there are still opportunities to flourish, according to a recent report by accounting software provider MYOB.
MYOB CEO Tim Reed said innovation and flexibility to adapt to the changes and forge ahead, in particular, will be key for businesses going forward.
“Following the handing down of the budget, it can be tempting for business owners to bunker down, play it safe and postpone their plans for growth. There are still opportunities to be had for SMEs,” he said.
“I’m pleased the government has set a target of reducing regulatory compliance costs on businesses, individuals and the community by $1 billion every year. Business owners and managers will continue to call for tax reform, deregulation and reduction of red tape – our latest SME research shows GST and BAS simplification continue to top the list of initiatives they hope to see.
“With the retirement age set to increase to 70 by 2035, small business stands to gain the most from taking up a new $10,000 incentive payment encouraging employers to hire over 50s. We encourage small and medium businesses to keep this in mind as they hire and install a new step in their hiring process to ensure they capture this benefit whenever they meet the necessary criteria.”
Reed also mentioned that fuel prices are once again the top pressure point for SMEs this year, as they have been since 2011.
“This change is likely to be the least popular part of the budget with SMEs, particularly so with certain sectors that will feel more pain,” he said.
"Our latest research shows agribusiness and Western Australian-based businesses felt the most pressure from rising fuel prices. Sixty-one per cent of SMEs would welcome investment in transport infrastructure in our major states and cities.”
Reed added that adopting online and teleworking technologies may help ease the pressure by enabling business operators to operate from home or any location outside of the office.
Plans to facilitate innovation and self reliance via a new Entrepreneurs' Infrastructure Programme are likely to be well-received by SMEs, however.
Research by MYOB showed that more than half of SMEs would support increased government funding for innovation, R&D and training on how to use the internet to grow their business.
“Further support for small business include creating a specialised unit to help small businesses gain better access to government contracts, which is supported by half of the SMEs we surveyed. We strongly encourage assisting SMEs to gain access to government contracts and also encourage SMEs to take up these opportunities,” Reed said.
“Small business will feel reassured that the budget has been put on a sound footing for the medium term.
"While no-one likes tax increases, and a number of consumers will likely feel the pinch, and this may constrain spending, past behaviour indicates there is a chance that Australian’s will believe the worstis behind them and that economic growth will continue unabated – fulfilling the rising business confidence that recent surveys have shown.”
