A Carbon Tax Calculator in the language of small business people – cash flow!


By Peter Strong . On 23-Aug-2012


Why do we need a Carbon Tax Calculator? When discussing our businesses most of us small business folk talk about things that are important for our business on a day to day basis. Issues such as: rent and lease costs, cure wages, drugstore power, phones, internet, transport, depreciation and the like. Simple words and concepts whereas in big business they talk complex things such as tax differentials, multifactor productivity, corporatisation and privatisation of their operations, profit related drivers, regression analysis and so forth. (In small business a profit related driver is often ‘Mum’ doing the books and then driving the kids to their sport on the weekends.)

Try the Carbon Tax Calculator for Small Businesses

So because many policy makers and senior public executives prefer fancy words and lots of complexity, the discussions on the impact of the carbon tax on business have been all about big business and the debates have focused on what big business wants and needs.

We at COSBOA tried to assist to focus some of the debate on small business and we provided the relevant departments with an example of the turnover figures of a small business. That was fine except that, without consultation, that example became the basis for determining the impact of the carbon tax on all small businesses. That was a mistake.

Simply put the small business sector is broad and disparate and the impact of the carbon tax can differ from sector to sector and indeed from business to business. Also, and importantly, we want to know what the impact will be on OUR business. Many small business people I speak to ask “what will be the day to day increase in costs for my business?” A very fair question which is called good management.

We need information. We need it in our language. We need it now (we actually needed it 6 months ago). If that information cannot be provided than we need to be given the tools to work it out for ourselves.

These tools needs to be designed for people as everyone of us who runs a small business is a person. Big businesses are things with boards of management and all sorts of experts, and money to pay other experts, to help solve problems.

So we here at COSBOA have designed a carbon tax calculator to help the person in their own business work out the minimum cost increase that will come from the carbon tax. The calculator mainly uses figures from the government to help determine the increase in costs. In some cases we had to work out what the costs might be (ok ok we had an educated guess) particularly for “the cost of goods”.

I stress this is the minimum. Others will say that the costs will be more – if so ask them to help you prove that fact.

Cost of goods – Determining the impact of the carbon tax on cost of goods is not easy and we will only know after 6 moths, or even twelve months, when all the bills and invoices have arrived and we can work it all out. For many small businesses it will be easy as they do not have a complicated business, this includes local delivery drivers, most home based businesses, consultants and the like. For other businesses the calculation is complicated, this includes for many retailers, cafes, restaurants, convenience stores, chemists and manufacturers. Indeed the only way I can see to make a calculation is to consider the increase in power costs for suppliers and for other members of the supply chain and then determine what that increase would be as a percentage of their, the suppliers, overall costs. This would be either impossible or so time consuming as to be detrimental to our business. But on the other hand I have had opinion from business owners that the cost of goods will work itself out through the supply chain and the increase in costs will not be their problem as that will be determined by producers and wholesalers. The real concern is for those with a large power bill who have to work out how to pass that increased cost onto their customers.

Also (always something else) we have the problem of the big landlords and, potentially, the big franchisors passing on costs unfairly to the small business person. This is particularly important for small business people trapped in the small business slaughter houses called Westfields, Centro, QIC and the like. In these charnel houses the big end of town, the anchor tenants like Coles and Woolworths, get cheaper rent and, maybe (nobody really knows), cheaper electricity. When the landlords pass on the increase in costs coming from the carbon tax they will be likely to ask the small businesses to pay a bigger share than the larger businesses. This means that once again we get the short end of the tax stick – another example of the failure of the advisers on competition policy of the last twenty years (woops sorry have I mentioned competition policy – I withdraw that comment and will save other comments for a future blog).

Anyhow we now have a carbon tax calculator, it isn’t perfect but will certainly provide information on minimum costs. Any comments (nice constructive ones please) are welcome and any suggestions on improvements that can help a small business owner will also be welcome. But please no ideas and suggestions that are based on emotions and politics, those things get in the way of good business and in the end the small business community will make their political opinions heard at the next election because we all vote (2.5 million votes cannot be ignored) and for all their money and power and influence, in the end, big business doesn’t vote.

About the author

Peter Strong

  • COSBOA AGM, Council Meeting & Business Leaders Dinner – 25 October 2017

    19-Sep COSBOA COUNCIL MEETING & BUSINESS LEADERS DINNER 25 October 2017 Hotel
  • Historical MOU with Business Council of Australia

    29-Aug Last week we had a very successful Vodafone National Small
  • ALPs Access to Justice – it’s time to be nice

    14-Aug COSBOA today acknowledged the importance of the ALP’s legislation on ‘Access to Justice’ when
  • COSBOA Submission: Inquiry into Sunday Penalty Rates

    03-Aug COSBOA's submission to the Inquiry into Sunday Penalty Rates is below: Thank you for the opportun
  • COSBOA’s Cash Economy Submission

    02-Aug COSBOA provided a submission to the Standing Committee on Tax and Revenue who are conducting an inqu
  • COSBOA Communique – Business Continuity & CyberSecurity

    28-May Cyber Security, telecommunications failures, power blackouts, website failures, disaster
  • The Cyber Security Issue – COSBOA Council Meeting: 24 May 2017, Hotel Kurrajong, Canberra

    15-May   Cyber Security hit the headlines over the wee
  • Fairness in Competition Gets Ever So Close

    24-Mar COSBOA today congratulated the government on the approach to changes to Section 46 of the Competitio
  • SmartCompany: Let’s focus on the issues that unfairly affect women who run their own small businesses

    08-Mar Peter Strong's article for International Women's Day in SmartCompany: As a bloke I can only c
  • Save the Date: VODAFONE NATIONAL SMALL BUSINESS SUMMIT 2017: 23-25 August 2017

    02-Dec 
  • National Contract Fairness Day! It’s arrived

    10-Nov Let’s celebrate the coming of fairness – the start of better innovation,
  • Who pays for double dipping in paid parental leave?

    24-Oct There are several ways of working out who pays for the double dipping in paid parental leave (PPL).
  • Payment of invoices – Australia comes last

    18-Aug Australia has easily found itself in last place when it comes to paying invoices on time.  We come
  • Competition in the Boardroom – a play in one act

    11-Aug At COSBOA we receive all sorts and we were lucky enough to be sent a small business play that reall
  • Census 2016 – Embracing Change

    10-Aug The events last night with the Census should not be used to attack and criticise or indeed to make u
  • Communicate, Engage, Involve, Communicate – that’s what a successful pack of dogs will do.

    16-Jul The Greyhounds decision is a great example of decision making gone wrong.  Perhaps the decision was
  • Contribute to the Campaign

    10-Jun After the article in The Australian 
  • COSBOA Vodafone National Small Business Summit Registrations Open!

    27-May It’s exciting when the months of planning start to come to fruition and the registrations for the
  • Pay taxes, stop dodging, stop playing games

    11-Apr The CosBullet – Tax collection needs fixing Below is an edited excer
  • 29,000 people support the government’s decision on the effects test – let’s get back to business

    30-Mar Petition to be presented to Kelly O’Dwyer at 2.30pm in the Minister’s office in Canberra
  • The Thinkers Hub – A Small Business Poem

    01-Mar It was somewhere up the country in a town built from rock and scrub That they formed a little busine
  • Is Competition policy decided by a few mega businesses and their union?

    19-Feb The development of better competition policy in Australia is vital to our future.  It is vital for
  • Penalty Rates: Sunday, fairness & jobs

    27-Dec There is a lot of carry-on around penalty rates.  The ideologues of the left want this to be a wedg
  • Security remains an issue – alert not alarmed, vigilant not a vigilante

    14-Nov Small Business people and the nation’s security National Security Hot
  • Tax reform can be managed – see Howard

    12-Nov Tax reform can be managed as long as we are all part of the reform process. Tax re
  • How many duopolies does it take to change a light globe in an aged care home?

    17-Oct In all the debate about the changes to Section 46 of the competition legislation (and the weird over
  • Latest argument for NOT having an Effects Test is just as silly as all the others.

    23-Sep  Trigger warning – Some jargon,
  • The dominant few big businesses are yesterday’s economy

    15-Sep Congratulations to Malcolm Turnbull and commiserations to Tony Abbott. With the change of Prime M
  • Our Champions are under threat from greedy, vested, rich corporate and union muscle

    11-Sep In the world of politics and influence there are some basic facts,
  • Misleading headlines don’t help the cause

    10-Sep Recently I was interviewed by The Guardian about the Effects Test and I made the normal comments and
  • When it’s your money – the game changes

    05-Aug The recent focus on politician's allowances and expenditure reminded me of a story I heard some year
  • Shopping Centres still playing with the facts

    26-Jul Shopping Centre Council misses the mark – as always Recently the Shopping Centre
  • Peter Strong’s National Press Club Address – 1 July 2015

    01-Jul COSBOA's CEO, Peter Strong delivered an address at the National Press Club on Wednesday, 1 July 2015
  • Peter Strong to Address National Press Club

    23-Jun Our CEO Peter Strong will address the National Press Club on Wednesday 1 July 2015.  Australia curr
  • COSBOA Chair addresses Maltese Chamber of Commerce

    17-May COSBOA Chairman and CEO of the Real Estate Institute of Australia (REIA) Amanda Lynch was in Malta r
  • Can we regulate the regulators?

    17-Apr Now is the opportunity to get information to the Productivity Commission, and through them the gover
  • 2.5 million people deserve better

    21-Mar COSBOA is extremely disappointed that we will once again have a new small business minister. The sm
  • Submission to the Senate Inquiry into the new Anti-Discrimination Acts

    05-Jan COSBOA Submission to the Senate Inquiry into the Exposure Draft of Human Rights and Anti-Discriminat
  • The Year that was -2012 – and the Year that will be – 2013 an election year

    19-Dec Please see our review of 2012 and needs for 2013
  • NAB and COSBOA announce new secondment to enable greater collaboration

    14-Dec COSBOA is pleased to announce the secondment of Janett Egber from National Australia Bank (NAB) who
  • Simplicity in Legislation Creates Productivity

    20-Nov This is an article written by John Strong,
  • New Taxation Commissioner – what does it mean for the self employed?

    14-Nov The government has announced the replacement for Michale D'Ascenzo (a great small business supporter
  • Small Business Champion for 2012 – Ondina Gregoric

    04-Nov It is with great pleasure that the Council of Small Business of Australia announces Ondina Gregoric
  • Coles and Woolies – still bullies

    03-Nov Great
  • Small Business in Asia – an example

    28-Oct Examples of some businesses established by Jaquillard Minns in Philippines during the last 5 year
  • Asian Century? Small business people are there already.

     COSBOA welcomes the release of The Asian Century White Paper today by the Prime Minister J
  • Is there a sea change in the way small business is viewed and treated?

    14-Oct Is something happening in Canberra around small business?  There have been some significant changes
  • Join the COSBOA board and other members at the October dinner with guest speaker Minister for Small Business, The Hon. Brendan O’Connor and Steve Lewis from the Canberra Press gallery

    11-Oct Book the 30th of October for a dinner at the National Press Club where our guest speakers will be Br
  • Australian Livestock and Rural Transporters Association

    05-Oct The ALRTA are members of COSBOA and they,
  • No job is better than $15 or $24 an hour? How?

    03-Oct COSBOA has provided a submission to the Senate inquiry into the Fair Work Act and penalty rates.  C
  • Submission to the Senate Inquiry into Penalty Rates

     Submission to the Fair Work Amendment (Small Business – Penalty Rates Exemption) Bill 2012
  • Join the COSBOA board and other members at the October dinner with guest speaker Minister for Small Business, The Hon. Brendan O’Connor.

    18-Sep Book the 30th of October for a dinner with Brendan O'Connor and other members and guests of COSBOA -
  • A Carbon Tax Calculator in the language of small business people – cash flow!

    23-Aug Why do we need a
  • Peter Strong’s Address to the National Press Club on 8 August 2012

    22-Aug Thank you ladies and gentlemen and special thanks and acknowledgement to the Deputy Chair of COSBOA,
  • How to define a small business? (well firstly we are all people)

    16-Aug Just what is a small business?  We currently have a range of definitions by a range of government a
  • The 2012 Economic Forum, the Asian Century and Innovation

    15-Aug COSBOA has two representatives at the Prime Minister’s Economic forum to be held in Brisbane this
  • Big win for owners of small trucking businesses – about time too

    19-Jul Congratulations to the Australian Livestock and Rural Transporters Association