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Fightback!: A winner for small business



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Philip Ruddock MP Federal Member for Dundas Shadow Minister for Immigration and Ethnic Affairs

29 April 1992

REF:

FIGHTBACK!: A WINNER FOR SMALL BUSINESS

The small business sector will be a big winner from the Coalition's FIGHTBACK! strategy, Federal Member for Dundas and Liberal Endorsed Candidate for Berowra, Philip Ruddock said.

Currently the small business sector is unnecessarily burdened with an antiquated and inequitable taxation system, and this is fundamental to the reform process outlined in FIGHTBACK!.

"The Coalition has had the courage to take the tough decisions needed to eliminate these burdens, and to restore incentive and prosperity to the small business sector", Philip Ruddock continued.

"Taxes which constrain business and business activities will effectively be abolished, including the Wholesale Sales Tax, payroll tax, the training levy, customs duty and excise on petroleum products.

The value to business of these initiatives is at least $20 billion."

Of particular benefit to small business will be the abolition of the two taxes on employment, namely payroll tax and the training levy, as well as the substantial reduction in fuel prices.

Because of their size, these sorts of imposts place a proportionally higher cost burden on small firms.

The Coalition will also amend Labour Capital Gains Tax.

"Capital Gains Tax is the big bugbear of small business. Indeed the Minister for Small Business has said that the CGT hinders small business and limits their capacity for growth and expansion. He has admitted that it is a problem and yet hasn't had the courage to tackle the problem head-on.

Only the Coalition has had the courage to tackle the problems facing small business.

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Small businesses will also accrue significant benefits from the introduction of a Goods and Services Tax and the accompanying 30% reduction in income taxes.

"All GST paid on inputs to businesses will be rebatable, meaning lower costs for small firms and enhanced competitiveness."

Mr Ruddock dismissed suggestions that the GST would prove complicated and cumbersome for small business.

"While the introduction of the GST may involve some additional compliance responsibilities for a number of small firms, it will remove an equal number from the existing administratively complex WST system.

"Calculation of th e GST will be based on businesses' existing accounting methods and, in many cases, will actually result in better business management practices. In addition, the improvement in cash flows which will accrue to small business will more than offset any additional administrative costs." v

According to Mr Ruddock the Coalition's privatisation and contracting out program will also be of significant benefit to small business.

"We will be transferring a number of responsibilities and resources from Government to the private sector. This will open up a whole range of new opportunities for the small business sector.

"Overall, our package will provide small business with the incentive, opportunity and reward to grow, develop and expand. They will be able to once again return to their rightful position of making a substantial contribution to employment and

our national economy."

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