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Green berets, shock absorbers, small business and a GST lemon.



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MEDIA RELEASE

 

Joel Fitzgibbon MP

Federal Member for Hunter

Shadow Minister for Small Business and Tourism

 

Green Berets, Shock Absorbers, Small Business and a GST Lemon

 

17 June 1999

 

Reports that the Federal Government will establish a “high-level rec onnaissance unit” to act as a “shock absorber” for the impact of the GST package on small business represents another admission that the new tax will be a nightmare for small firms, Shadow Minister for Small Business, Joel Fitzgibbon, said today.

 

“As Peter Costello put it, the partial food exemption will create Nightmare on Main Street for small food retailers. His reconnaissance unit will need to be of Green Beret standard and his so-called shock absorber of 4WD proportions.

 

“The Howard Government has consistently ignored advice from both the Opposition, and better informed quarters of the Australian Democrats, that the GST compliance burden will fall most heavily on the small business sector.

 

“Today’s revelation is an admission by the Howard Government that small business is justifiably running scared from the GST. Small businesses are receiving little information about how the new unfair tax will work, who will pay for the new systems, and why we need a new tax in the first place.

 

“Yet the Government is keeping secret the findings of the Small Business Consultative Committee (SBCC) - a key report from the body charged with making recommendations about how to distribute the $500 million compensation fund for small firms. It has to be asked - what does the report say and how much of the $500 million will remain after the ATO has grabbed its share? Has the SBCC discovered what we already know - that small business will have to carry the GST can?

 

“The facts remain. The introduction of a GST will hit small business in many ways:

 

• A new tax on every stage of production, from wholesale to distribution to retail

• A dramatic increase in paperwork for calculating the GST on inputs and outputs

• The installation of new computer systems and cash registers

• A com plete revaluation of all stock for the change-over

• The compliance burden falling most heavily on small business by a factor of 20

• Heavy penalties for any miscalculations

• Complex calculations for food that is exempt versus food that is GST liable.

• Heavy costs for staff training

• A forced cost absorption for any changes in price

 

“Instead of spending more taxpayers’ money dispatching the Green Berets, the Howard Government should admit to the small business community that the GST is nothing more than a lemon,” Mr Fitzgibbon said.

 

Contact: Cassandra Gelade 02 6277 4404 or 0407 496 237

 

 

dd  1999-06-18  11:24