Taxing times for business

Federal Small Business Minister Bruce Billson, who was in Middle Swan last Wednesday to address a meeting of small business owners organised by the Swan Chamber of Commerce, said WA Treasurer Mike Nahan was the only politician holding up proposed changes to the GST.

But a spokesman for Dr Nahan said WA would never agree to the reforms unless it got a fair share of per capita funding.

WA was lobbying for much broader reforms to the GST distribution process and until that was resolved, Dr Nahan would not agree to lowering the GST threshold on imported goods.

Under current legislation, no GST is payable on imported goods with a value of less than $1000, a policy that has hurt many local businesses.

In a statement released on Thursday, Dr Nahan said: ‘If WA received its population share of GST, it would be $3.7 billion better off in 2014-15 than we are now’.

Dr Nahan said broader GST reform over the distribution process remained the biggest issue for the State’s economy. The ‘unfair distribution’ had resulted in the government’s finances being placed under pressure.

Midland Honda proprietor Eddie Peters said the lack of GST on overseas purchases of less than $1000 was hurting his business and he was not alone. He was joined at the Chamber forum by other local business owners, some of whom said they also were on the brink of closure.

Mr Peters has started an online petition for small business owners and has seen the number of signatures grow.

‘It seems with the traction we are getting on this thing that the problems facing small businesses in Australia are universal,’ he said.

Retail spending figures from the Australian Bureau of Statistics last year showed that between 2012 and 2013, an average of $20 million was spent daily on overseas purchases of goods under the GST threshold.

Mr Peters said this expenditure was taking the future jobs of Australians during tough times for business.

‘This money should be going into Australian pockets, not overseas bank accounts,’ he said.

Mr Peters said it was important for local businesses to have a level playing field.

‘Maybe then more people would shop locally,’ he said.

‘We employ Australians but we can’t if our businesses are failing. With other retailers, we want to pressure governments for substantial change to the environment for Australian retail business, so we can be competitive again. The Government needs to encourage people to invest their money in Australian business, not help them spend it outside this country.’

WA Premier Colin Barnett said he was frustrated and ‘bordering on angry’ over the State’s unfair GST distribution.

‘It’s basically legalised theft,’ he said, referring to the $3.7 billion taken off WA this financial year.

Mr Barnett said the policy meant he had to cut public sector and health and education services.

‘We can deal with the iron ore price falling, we expect to see volatility in iron ore; what we can’t deal with is a fall in GST revenue,’ he said.

Mr Billson said the Federal Government still hoped to reform the GST but other reforms made in the past 12 months were already beginning to help small business.