New policy hopes to put state businesses 'ahead of the game'
The Chamber of Commerce & Industry Queensland (CCIQ) welcomed the government’s decision to provide payroll tax relief for small-and-medium enterprises (SMEs) in the recent Queensland Budget FY23.
According to the CCIQ, the payroll tax relief meant that SMEs would be motivated to hire more individuals, supporting them to scale and grow and pave the way for potential future reform.
“We welcome today’s announcement as it means small-and-medium-sized businesses have been afforded some incentive to grow their workforce without facing higher tax bills, supporting them to better meet consumer or market demand, diversify, scale and grow,” CCIQ CEO Heidi Coopers said.
The State Budget summary report, published by the CCIQ, stated that the reform would benefit approximately 12,000 businesses with reduced payroll tax liabilities.
It further stated that starting 1 January 2023, the $6.5m taxable wages deductions ceiling would be extended up to $10.4m.
Long-waited reform
Coopers said that the payroll tax relief had been a “long championed reform” to address the existing tax burden and structure that constrained the growth of many Queensland businesses.
In the CCIQ state budget submission, the business sector asked for a payroll tax reform to ensure Queensland businesses were “ahead of the game.”
“The changes we have seen in today’s budget are a positive step forward in ensuring Queensland businesses can grow, particularly at a time when business costs are increasing,” Coopers said.
According to CCIQ data, 7 out of 10 businesses reported an increase in business input costs during the last quarter and would not be expected to have a relief in the June quarter.
“At the same time, labour costs increased to record highs in the last quarter with little relief expected on the horizon,” the CCIQ said.
Cooper said that the government’s inclusion of the payroll tax relief in the State Budget meant that it recognises the current pressures on businesses and would help alleviate some immediate business input costs.
“There is still work to do, including using national cabinet as a forum for advocating for broader holistic payroll tax reform at a federal level,” she said.
Aside from the payroll tax relief, the CCIQ said it also saw optimistic actions for infrastructure investments, such as the focus on regional water projects, support for mental health, and continued funding for small business support programs.
“We know that businesses are still facing ongoing challenges and constraints to growth, including critical labour shortages and all time high operating costs, “ Cooper said. “Ongoing engagement with businesses also reflects a need to transform the Queensland economy to be more resilient, efficient, and productive through sustainability.”
