Australia has recorded 29,000 small business closures in three years.
Renee Bartov, owner of the men’s grooming salon, is a barbers salon in Martin Square, a financial centre in Sydney, and has been fighting hard to bring business to light since Covid-19.
The pandemic left her struggling with a closure, an vanishing customer base and a slow path to recovery.
However, new challenges have been revealed, even as customers return, including rising inflation, rising operating costs and a significant shortage of skilled workers.
She points to the astounding 29,000 small businesses in the past three years as evidence that the current economic situation has been at the forefront.
“We are the largest employer in the country, but we are always considered last,” she told the Epoch Times, criticizing the government’s policy that it has contributed to the huge failure rates of small businesses.
Seek for a more serious policy
Bartov says policies like personal tax cuts for workers announced in the budget, or instant asset amortization of $20,000 are inadequate.
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She is seeking wider tax cuts and a significant reduction in deficits for businesses, particularly in the field of industrial relations (IR) (IR).
The woman will set up tables and chairs outside a restaurant in Melbourne, Australia on July 28th, 2021. Con Chronis/AFP via Getty Images
“Changing non-competitive clauses at hair salons, for example, could ruin us, and they didn’t even ask for our opinion,” she laments.
Labour has announced that it will remove non-competitive clauses for those earning less than $175,000 a year. This means that even if you are in the same proximity, you can move freely between similar tasks.
Time to cut small businesses: Council
Luke Achterstraat, CEO of Australia’s Small Business Council (COSBOA), reflects Bartov’s concerns, saying that small businesses are the “lifeline of the economy.”
Cosboa is urging policy makers to cut tax rates from 25% to 20% for businesses with sales of less than $20 million, citing costs of living and excessive deficits.
“Small businesses are the engine room of the Australian economy and part of our social fabric,” he tells the Epoch Times, calling workers’ latest budgets “overwhelming” and “missed opportunities,” driving small businesses growth.
A general view of the interior of the old Clare Hotel in Chippendale, taken through a window in Sydney, Australia on May 3, 2020. Ryan Pierce/Getty Images
Achterstraat also said that amortization of instant assets is helpful, but that it should be permanent.
According to Cosboa’s survey, 69% of Australians are considering lowering taxes on small businesses.
Migration that brings wrong skills
Meanwhile, Bartov says that while transitions are high, the country doesn’t bring in the right skills.
“We don’t have hairdressers, we don’t have builders. There’s a shortage of merchants and instead of dealing with that, the government has made it even more difficult with the outrageous visa sponsorship costs,” she said.
She added that the increase in the temporary, skilled immigrant income threshold (TSMIT), which sets the minimum wage rate for migrant workers, has raised wages beyond industry awards, putting an additional financial burden on companies like her.
Bartov asked for more transparency on visa fees and questioned why businesses were so charged to sponsor visas when there was little evidence that funds were being reinvested in training Australian workers.
Election Promise: Which party will deliver?
As elections approach, both major political parties are fighting for the support of small business owners.
Labour has announced various measures, including an additional $150 energy rebate for eligible businesses, stating that it has given $800 or relief since 2022.
To cut red tape, it pledged $900 million and $207 million through the National Productivity Fund to modernize the business register.
Meanwhile, the Union offers a more direct tax relief.
Opposition leader Peter Dutton has pledged to increase the amortization of instant assets from $1,000 to $30,000, making it permanent.
He also pledged to reintroduce the $20,000 deduction on small business entertainment costs, allowing owners to charge for food and fun, like a team building event.
To tackle the skills crisis, he set goals for 400,000 apprentices and trainees, and the business received $12,000 to hire in key industries.
For Bartov and thousands of small business owners like her, the interests never increased.
“We don’t need to talk any more. We need to take action,” Bartov says.
