The Council of Small Business Organisations Australia (COSBOA) has called on tax cuts to be given to small businesses and operators.

As the federal election campaign is now underway, COSBOA wants the tax rate for small businesses with an annual turnover of $20 million or less to be reduced to 20 per cent from the current rate of 25 per cent.

While other tax rates would stay the same, COSBOA says this would provide instant relief to struggling small businesses and operators.

COSBOA CEO Luke Achterstraat says small businesses are bearing the brunt of the cost-of-living crisis and suffocating red tape. National polling from independent pollster, Insightfully, identified broad voter support for the tax cut, with 69 per cent of voters saying the cut would provide much needed relief for small businesses. In marginal seats, this increased to 76 per cent.

“Small businesses are the engine room of the Australian economy and part of our social fabric. They are local cafés, where we catch up with friends. They are farming families that grow our food. They are the baker who is up at 3am every day to bake our bread. And behind every small business is a family, their staff and their customers,” Achterstraat says.

“But small businesses are doing it tough. Like their customers, they’re bearing the brunt of the cost-of-living crisis, red tape is increasing, and staff are getting harder to find. Our research shows that without urgent change, 50 per cent of small businesses are worried about surviving.

That’s why COSBOA is calling for sensible changes to enable small businesses to keep prices stable, employ more staff and invest in innovation so they can compete with huge multi-nationals. Cutting the tax rate would have an instant impact and provide Australian small businesses with the fair go they deserve.”

With small businesses comprising just under 98 per cent of all Australian businesses, Achterstraat says this cut would help local communities around the country who rely on these businesses and operators.

“This tax cut would provide instant respite to Australian small businesses and let them focus on what they do best – running their businesses and serving our communities,” he says.

“Investment growth has been lacklustre in Australia, leading to reduced competition, higher prices and lower living standards. RBA research confirms lower tax drives new investment.

“With this simple, sensible change Australian small businesses will be primed to thrive now and into the future, better able to contribute to the economy and their communities.”