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Labor and unions eroding small business confidence.

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Media Release The Hon Joe Hockey MP Minister for Small Business and Tourism

27 May 2003 03/098


Many of Australia’s 1.1 million small businesses are hampered by State Labor Governments and concerned about trade union intervention according to the Yellow Pages ‘Business Index’ released today.

Small business confidence is suffering, particularly in NSW and Victoria because of the anti-small business policies of State Labor Governments.

According to the survey:

• Queensland Government policies recorded a decline in support. • Victorian Government policies recorded a marked drop in support. • Western Australian Government policies continued to be the least supported of any state in Australia according to surveyed SMEs. • Tasmanian Government policies recorded a significant fall in support.

The reasons for the alarming decline in confidence by small businesses in Victoria were;

“Factors such as union influence, workers’ compensation regulations and lack of incentives.”

For example, in Victoria the elimination of the payroll tax exemption for trainees and apprentices will deter small firms taking on junior workers - an Australian Financial Review report of 14 May stated that this will net the Victorian Government $160M over 4 years and small business will be paying for it.

Increases in stamp duty on general insurance premiums in Western Australia will hit small businesses already struggling with rising insurance premiums.

Small businesses continue to struggle under the burden of state and territory taxes and Labor continues to see small businesses as cash cows, with tax grabs such as payroll tax acting as a disincentive on small businesses hiring more staff and hampering growth.

The Federal Government is reducing the burden on small business, removing a number of taxes and delivering low interest rates but Labor state governments are holding this progress back.

Media contact: Sasha Grebe, 02 9929 9822 CMR03-114