IPA laments lack of Budget support for small business

The Institute of Public Accountants (IPA) has emerged as one of the harsher critics of the Federal Budget, arguing that it has failed a critical test: “reversing the alarming slide of Australia’s small business sector”.

“Small businesses are confronted with unprecedented challenges. Data reveals a disturbing trend: their contribution to GDP has plummeted from 40 per cent in 2006 to just 33 per cent today, while their share of private sector employment has fallen from 53 per cent to 42 per cent,” IPA chief executive, Professor Andrew Conway said.

“The numbers speak for themselves,” he said.

“Nearly half of our small businesses are operating at a loss, and the majority of self-employed owners are earning less than the average full-time wage. This is unsustainable.”

“Rightly, there is a focus on cost-of-living relief for households, but self-employed business owners continue to go backwards. The energy bill relief and the delayed income tax changes will barely make a dent in the additional costs these businesses have experienced in recent years.”

Conway said supporting small business is crucial to revitalise Australia’s productivity and grow our economy. Yet, the budget is silent on investing in small business innovation and nurturing grass-roots research and development.

“We need to diversify our sources of economic security through supporting innovation in revolutionary technology – digital, AI and medical.”

“Australia’s future can’t be built by putting all our eggs in the green metal basket.”

“Small businesses are also burdened by complex and escalating compliance obligations, hindering their ability to thrive,” he said.