The Coalition’s recently released small business strategy reflects this understanding. They released this bombshell late on Good Friday, including promises of massive tax offsets for emerging new small businesses. Under this proposal, businesses would only have to pay taxes on 25 percent of their initial $100,000 income. Its purpose is to reduce financial pressures for new and developing businesses. This announcement comes at a time of unprecedented policy rollbacks and attacks. These controversies have led to widespread criticism and calls for reform of the Coalition’s small business support framework.
The time Labor at last came around. It has since scrubbed all mentions of the Makarrata Commission from its policy platform. The Makarrata Commission was first proposed by Australia’s Prime Minister Anthony Albanese on the evening that he emphatically won the 2022 election. Its role is to be a “truth-telling” institution on behalf of First Nations peoples. This apparent shift away from the commission coincides with the Coalition’s recent about-face on its work-from-home policy, which has fueled further scrutiny of both parties’ campaign strategies.
Small Business Strategy Details
The Coalition’s new strategy is designed to provide financial relief to start-up businesses, with tax incentives aimed at fostering growth. Businesses would only be liable for taxes on 25 percent of their first $100,000 of income. This new approach lets them retain more of their revenue during their crucial early ramp-up years. This new initiative is designed to pump money into the economy. It strategically targets industries most severely impacted by recent crises.
Liberal Leader Peter Dutton this week underscored the importance of backing small to medium businesses. He emphasized that this new approach is key to our economic recovery. Despite this, Dutton has faced criticism for sidelining another key policy aimed at small businesses: a proposal to grant businesses up to $20,000 in tax-free staff meals.
The county’s policy was initially hailed as a “shot in the arm” for local small businesses and the hospitality industry. Dutton’s proposal drew heavy criticism and doubt about the practicality of such a proposal amidst an unprecedented cost-of-living crisis. Since his budget reply speech in March, he’s only uttered the word once.
“I think it’s disappointing that, you know, the policy has been politicised and put into a sort of a faux class war,” – Luke Achterstraat, chief executive of the Council of Small Business Organisations Australia.
Labor’s Policy Retreat
In an extraordinary about-face, Labor has decided to drop any mention of the Makarrata Commission. This is a significant departure from its policy agenda. This decision represents a departure from the party’s earlier pledges. This practice casts serious doubt on their commitment to solving problems faced by First Nations. The independent Makarrata Commission was created to establish a process of truth-telling and healing. Its absence from Labor’s platform marks a politically savvy pivot as the election approaches.
This retreat comes on the heels of similar backlash from within the Coalition over its contentious work-from-home policy for federal public sector employees. Though it was initially introduced to much fanfare as a game changing policy, it came under immediate attack and fire. In the wake of this outcry, Dutton bowed to the pressure and admitted to getting it “wrong” on the work-from-home pilot.
It’s a tricky political tightrope for both parties to walk. Advocates and policy observers agree that changing policies can change the debate and public perception, including increasing voter support.
Coalition’s Policy Challenges
The Coalition’s proposal to make staff meals tax-free has been criticized for being politically tone-deaf during continued economic challenges. The initiative has come under fire from business figures. They think it’s completely out of touch with the realities that so many Australians are experiencing right now, especially as the cost-of-living crisis continues. The critics will just say that those policies are easy to do and can be blown off as wasteful spending.
The rollout for this new meal policy was plagued with confusion. At first, organizations were thrilled at the opportunity to write off $20,000 in meal and entertainment costs—with alcohol removed. Yet many received these specifics as a cause for skepticism. Labor was quick to condemn it a “farce.” They contended that it would allow employers to tax-deduct trips that don’t really improve employee well-being.
Despite these setbacks, the policy remains listed on the Liberal Party’s website and continues to generate discussion among stakeholders in the small business community.
