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Industrial relations number one priority for manufacturing, construction and services sectors
Industrial relations, excessive red tape and regulatory burdens, as well as tax reform, were ranked as the top business policy priorities for the next federal government, according to a survey by the Australian Industry Group (AIG). The study said industrial relations reform is a particularly high priority for medium-to-large manufacturers that traditionally have a high rate of trade union membership and want to remove “digitizes” in unfair dismissal laws and wage bargaining. The construction sector, in particular, thought a reduction in red tape was the highest priority for the next government, while more than a quarter of service providers said a reduction in company tax rates and tax reform were most important.
Small business has an $11 billion tax problem
At a recent small business summit, Taxation Commissioner Chris Jordan highlighted that 60% of the tax debt on the Tax Office’s books is owed by small business – compared to 10% in the last financial year. Jordan said a vast range of personal circumstances can sometimes exacerbate the problem – with operators who can be sole traders, or running the business as a trust, a partnership, as a company or a combination of some or all of these entities complicating tax obligations. However, Jordan encouraged businesses to use the Tax Office’s “Business Viability Assessment Tool” and said the Tax Office is perfectly willing to examine a business’s payment and lodgement history, and work out a flexible payment arrangement that suits a business’s cash flow.
Extended business payment times point to poor financial health: Dun & Bradstreet
Australian businesses are taking longer to pay each other in 2013 compared to a year ago, in an indication of poor financial health, Dun & Bradstreet (D&B) found in its latest Trade Payments Analysis. And in industry sectors, businesses in the retail and mining sector have been the slowest to settle their accounts in the first half of the year – as 57 days – while utilities companies have taken 56 days. Conversely, the fastest paying businesses are from the transportation sector, at an average of 50 days.
New ASIC and ATO resources now available
ASIC has released a booklet in an effort to make compliance a less daunting task for businesses. The booklet will cover key topics such as ASIC’s regulatory role and functions, types of business structures regulated by ASIC, responsibilities for managing businesses under a company or business structure, and obligations under key ASIC-related laws. Similarly, small businesses are now able to use the government’s newly updated Small Business Resource Kit, a USB flash drive that contains useful information and resources catered towards small business owners and start-ups. Business owners can obtain the resource kit by contacting the Small Business Support Line on 1800 777 275, emailing [email protected] or visiting the website.
ACCC cracks down on businesses that make misleading, false advertisements
The Australian Competition and Consumer Commission (ACCC) received more than 1,000 complaints and inquiries in the past year alone – mostly from advertising services, non-store retailing (such as online retailers and milk vendors without shopfronts), “other” store-based retailing (such as art galleries and pet shops), travel agency and tour arrangement services, and wired telecommunication network operations. The ACCC is targeting “credence claims” in particular – that is, claims of product quality that are designed to improve the appeal of a product when compared to a similar product. A popular credence claim is that a product is “organic”.
Cafes, restaurants and caterers under Fair Work’s compliance spotlight
Up to 1,500 cafes, restaurants and caterers will find themselves under the Fair Work Ombudsman’s compliance microscope as part of a national education and compliance campaign. Fair Work inspectors will audit hospitality businesses to check if they are paying their employees’ minimum entitlements – including hourly rates, shift loading and penalty rates, maintaining appropriate records, and providing pay slips – and have already written to more than 36,000 employers in the sector to highlight free resources that would help them comply with workplace law.
Consumers respond well to interest rate cut
Businesses may be buoyed by an upturn in consumer sentiment, after the Westpac Melbourne Institute Index of Consumer Sentiment rose by 3.5% from July to August. Excluding the period between February and March this year, the upturn was the highest since February 2011 and was found to be a direct result of the Reserve Bank’s decision to cut the interest rate to a record low of 2.5% in August. Confidence among individuals with a mortgage also lifted by 7.4%, while confidence in non-metropolitan areas was up by 11% – the latter seen to be due to a combination of relief for borrowers and improved outlook resulting from the more competitive Australian dollar. Similarly, confidence over family finances over the next 12 months went up by 9.7%.
Research shows service innovation, not cost cutting, better for small business
An American Express nationwide study of more than 1,000 small businesses revealed that companies that improved their product and service offerings reaped more rewards than those more focused on cost containment. Half of the small businesses that improved their product or service offering increased their profits in the past year, while 57% of small businesses that ramp up marketing activity also enjoyed higher profits. Conversely, 40% of businesses that reduced expenditure as a future-proofing measure actually saw a reduction in profits, with 26% expecting the trend to continue into 2014.
Australia breaks into top five G20 entrepreneurial countries
Australia is now ranked in the top five of G20 countries that have a favorable environment for entrepreneurial activity, but it can do more to foster businesses, a new Ernst & Young report found. Australia faltered in the following areas – access to funding for young entrepreneurs, complex tax rules and regulations, a high company tax rate and decline in government trained programs – but ranked well in terms of:
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