Small business tax rate cut path to productivity: COSBOA

The Council of Small Business Organisations Australia (COSBOA) welcomes the Australian Productivity Commission’s (PC) recommendation to cut the small business company tax rate to 20%.

“Cutting the small business tax rate to 20% for small businesses with an annual turnover of less than $20 million would put billions back into the economy and help drive Australia’s productivity,” said COSBOA Chair Matthew Addison.

This is a strong endorsement of COSBOA’s long-standing position. Our recent modelling shows that reducing the tax rate from 25% to 20% for small businesses would inject up to $11.4 billion into GDP over five years.

“Small businesses are the engine room of our economy – they must be front and centre in the tax reform debate,” Mr Addison said. “This is the kind of reform that boosts confidence, investment and growth across the small business sector.”

However, COSBOA warned that more must be done to ensure unincorporated small businesses are not left behind.

“We cannot afford to leave unincorporated small businesses behind in tax reform, they make up the majority of the sector and are critical to our communities,” Mr Addison said.

“We see the PC’s recommendation on the small business tax rate as a step forward, but it’s only the start of the tax reform journey, with COSBOA as part of the coalition of business groups putting forward an endorsed set of recommendations. We are reviewing the rest of the PC’s recommendations and consulting with our members on the impact of the new proposal for a cashflow tax and broader company tax cuts on the economy.”

COSBOA looks forward to contributing to the Economic Reform Roundtable and working closely with government to deliver meaningful, sustainable tax reform that supports all small businesses.

-ENDS-

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About COSBOA

Established in 1979, The Council of Small Business Organisations Australia (COSBOA) is a member based not-for-profit organisation exclusively representing the interests of small businesses. The capability, representation, and reach of COSBOA are defined by a mix of over 50 national and state-based members. COSBOA's strength is its capacity to harness its members' views and advance consensus across policy areas common to many.

Our member organisations work with the COSBOA team to assist us with policy development and guide our advocacy - not just for small businesses but also for the benefit of the Australians they employ. In this capacity, COSBOA makes submissions and representations to the government, including its agencies, on issues affecting small businesses and to pursue good policy.

For more information, visit www.cosboa.org.au