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Budget response: ALP announces small business policy

Friday, May 15, 2015

Yesterday we sent out a summary of, and commentary on, the Abbott government’s Budget policy initiatives for small business people. We’ve given the package a big tick. It’s essentially a tax-reduction approach to encouraging small business activity. We think that’s the most effective way to go.

Last night the Labor opposition supported the package, which means it will pass the Senate. Labor leader Bill Shorten also announced an aspiration to reduce small business tax by 5 per cent.

This morning we received Labor’s policy commitment. It has two items:
  • A government-supported micro-finance initiative.
  • A $500 million Smart Investment Fund.
Here’s Labor’s policy Fact Sheet.

The Abbott government’s:
We’re not keen on government-controlled ‘innovation’ funds for small business people. Such government funds mean that:
  • Only a small number of people get the money. Most miss out.
  • Money gets ‘lost’ with administration by bureaucrats. Entire ‘consultant’ sectors emerge to assist people to make applications. It’s a waste!
  • Application forms are always terrible and tightly targeted to what the government thinks is ‘innovation’ instead of letting the innovative people decide.
  • Auditing of people who’ve received grants is horrible, complicated and hugely time consuming. Another waste.

So, thumbs up for tax-reduction packages. Ho hum with government-controlled ‘innovation’ funds.


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