The National Retail Association (NRA) has praised the Federal Budget announced by Treasurer Josh Frydenberg last night. The Budget will provide wins for small and medium sized businesses, but operators in areas reliant on international tourism have been left in the cold.
Business tax measures will aid small business owners
NRA CEO Dominique Lamb said the measures aimed at boosting customer spending and encouraging business investment are welcome additions.
“Extending tax cuts for low and middle-income earners will mean that everyday Australians will now have more disposable income to spend at the shops, providing an adrenaline boost to retailers’ bottom lines” Ms Lamb said.
Additionally, a 12-month extension to the temporary full expensing measures until 30 June 2023 and a 1-year extension of the temporary loss carry back will allow businesses to invest in their future.
“The NRA has been advocating for the continuation and expansion of the instant asset write-off since before COVID-19 came along. Local cafes, family-owned restaurants and small clothing shops to name just a few will now be able to make investments in their business that would otherwise be unaffordable.”
Simplifying the murky industrial relations system
The Federal Government will spend $134 million over four years on its deregulation agenda, including investing in regulatory technology (regtech) to support smaller employers comply with modern awards, provide data on pay and conditions and help with accuracy in payroll software.
“Most people outside the sector think we’re exaggerating when we say that since 2013 retailers have had to deal with nearly 14,000 different rates of pay depending on variables such as whether the employee is casual or permanent, their age, their classification and the times at which the work is performed. This number easily doubles if you consider shift workers, baking production employees, apprentices and those working under the supported wage system,” Ms Lamb said.
“The NRA applauds the Federal Government for recognising the complexity of the system, and taking steps to improve compliance.”
“We look forward to working with the Morrison Government to ensure Australia’s small business owners are well-served by these measures.”
Business restructuring measures patchy, particularly for tourism hotspots
We expect to see an increase in distress for businesses exposed to international travel and events due to prolonged border closures, despite short term stimulus measures. The $1.2 million support package for the aviation industries is welcome but will not be enough for many struggling retailers, particularly those suffering from decreased foot traffic in airports and CBDs.
“We need to work on getting people back into these areas. Small and family owned businesses are the cornerstone of the hospitality and tourism sector, and it’s crucial they receive support to ensure they’re still here, ready to do business, when borders reopen,” Ms Lamb said.
Investing in the digital economy paramount after 2020
“People spent 2020 predominantly at home, shopping from the comfort of their living rooms and couches. While we’ve certainly seen spending in store return to normal in many parts of the country, it’s now the time to invest in the digital economy,” said Ms. Lamb.
“Particularly coupled with incentives for entrepreneurs, investment in digital skills is a great move for retail. Many entrepreneurs, a significant percentage of these being women, start their businesses with their laptop. Investing in digital skills and infrastructure will give more retailers the opportunity to start, and boost, their business.”
Focus on women a good start, and Government must continue to build on this foundation
The Australian retail industry continues to be a key employer of women, providing a variety of opportunities in both sales, and non-sales roles. Measures aimed at providing economic security for women
“Certainly the access to childcare subsidies will give women the freedom to create their own businesses and participate economically. Removing the $450 per month threshold under which employers are exempt from paying employees, predominantly women, will also provide certainty for these women as they look towards retirement. It’s of paramount importance that Government, and retailers, continue to work towards equal opportunity in leadership opportunities.”