A small business portrait of tax, employment and business risk

Abstract

The purpose of this paper is to present analysis of the CPA Australia database of small business responses to a series of surveys conducted from July 2001 to August 2002. The survey responses have been collated and reported based on the general findings by CPA Australia. Unfortunately, no in depth analysis was undertaken using the demographic data collected, nor a comparison across the question responses. Although the general survey findings have been useful to both government and business groups, there was an opportunity to explore the diversity across demographically distinct groups. This is important given that policy and government support are normally targeted to different groups, at different times and for different purposes. The first survey conducted in July 2001 concentrated on the introduction and implementation of a new tax system that was instituted by the government of the day on 1st July 2000. The survey captured unique perspectives on small business behaviour, perceptions and reactions to a change in legislation that impacted so directly on their daily operations. The second survey conducted in March 2002 obtained small business and public accountant’s responses on a range of employment issues. Legislation can impede small business hiring new staff and it is important to recognize how. The understanding of small business owners of human resources practices, including hiring, motivating and performance management; as well as government related matters such as payroll tax, workcover, superannuation, and unfair dismissal laws are captured in the survey responses. Business Risk was the focus of the final surveyed conducted in August 2002. Unfortunately, small business owners are unaware of some of the business risks and therefore do not manage them properly. The increase in competition, the global nature of business, the insurance industry instability, the constant change in technology, natural disasters and the accepted movement of staff are all risks that impact on small business and their ability to grow. Each survey was conducted via the phone with 600 small businesses and 105 public practice accountants across Australia. The analyses of the data across demographic groupings create a picture of the business landscape for the benefit of policy makers and small business themselves.