THE Institute of Public Accountants (IPA) has continued its support of the small business sector through its 2016 pre-Budget submission to the Government.

“The IPA’s submission puts forward a number of key policy recommendations, focusing particularly on the key pillars required for a more productive and dynamic small business sector,” said IPA chief executive officer, Andrew Conway.

“However, the recommendations within the submission are presented against the background of a looming economic downturn.

“Our Australian Small Business White Paper published in late 2015 shows that after more than two decades of prosperity driven by booming prices for mineral exports, Australia now faces the real prospect of a sustained fall in living standards.

“Apart from a deteriorating federal budget, the core of the nation’s economic problem is its failure to lift business productivity for much of the past 15 years.

“Sadly, this means that Australia’s businesses collectively are barely more efficient than they were at the start of this century.

“This situation must be arrested now if we are to continue to enjoy the standard of living we enjoy today.

“To this end, we are hopeful that the Government will take serious consideration of our key recommendations which include a loan guarantee scheme, venture capital funding, building an innovation system, boosting skills and human capital, and the need for robust tax reform,” said Mr Conway.

For more information on the IPA’s pre-Budget submission go to http://bit.ly/1PVGJX7

About the Institute of Public Accountants

The IPA, formed in 1923, is one of Australia’s three legally recognised professional accounting bodies.  In late 2014, the IPA acquired the Institute of Financial Accountants in the UK and formed the IPA Group, with more than with more than 35,000 members and students in over 65 countries.  The IPA is a member of the International Federation of Accountants, the Accounting Professional and Ethical Standards Board and the Confederation of Asian and Pacific Accountants.  The IPA was recognised in 2012 as Australia’s most innovative accounting organisation and listed in the top 20 in the 2012 BRW Most Innovative Companies List. 

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VICTORIAN business sentiment about the Victorian and Australian economies over the next year has risen strongly, according to the Victorian Chamber of Commerce and Industry’s Survey of Business Trends and Prospects released today.

The Victorian Chamber’s Survey of Business Trends and Prospects summarises the views of over 500 metropolitan and regional Victorian businesses across seven major sectors.

Over the December quarter 2015, 23 percent of respondents said they anticipate stronger national economic growth over the next year. Sentiment for the Victorian economy also rose, with 23 percent of respondents also expecting better economic conditions in the year ahead.

Businesses reported growth in net sales, exports, employment and investment in plant and equipment during the December quarter. However, wages and other labour costs also continued to rise, squeezing profits.

“Despite the rise in business sentiment, business confidence remains fragile and more must be done to sustain and grow this newfound optimism,” said Victorian Chamber Chief Executive Mark Stone.

“These findings point to an opportunity for both state and federal governments to deliver business-focused 2016-17 budgets that convert this sentiment into medium and long-term economic growth and job creation.

“Victorian business is looking to governments to deliver budgets that reduce the cost of doing business, drive productivity through major infrastructure projects, boost workforce skills and grow our international trade capabilities.”

The Victorian Chamber of Commerce and Industry, established in 1851, is the most influential business organisation in Victoria, informing and servicing more than 15,000 members, customers and clients around the state.

victorianchamber.com.au

ENDS

THE House of Representatives Standing Committee on Economics will hold a public hearing with the Governor of the Reserve Bank of Australia, Mr Glenn Stevens, in Sydney from 9:30am to 12:30pm this Friday, 12 February 2016.

At its meeting on 2 February 2016 the RBA decided to leave the cash rate unchanged at 2.0 per cent. The Governor noted in his statement that ‘new information should allow the Board to judge whether the recent improvement in labour market conditions is continuing and whether the recent financial turbulence portends weaker global and domestic demand.’

The Governor concluded that ‘continued low inflation may provide scope for easier policy, should that be appropriate to lend support to demand.’

The Australian economy continues to demonstrate resilience even though the global economy is growing at a slightly lower pace than earlier expected. The Governor noted that ‘the available information suggests that the expansion in the non-mining parts of the economy strengthened during 2015 even as the contraction in spending in mining investment continued.’

In relation to China, the February Statement on Monetary Policy noted that ‘the outlook for China’s growth is a significant uncertainty for the outlook for the Australian economy.’

The Chair of the House Economics Committee Mr Craig Laundy said ‘the committee will examine these issues in more detail and examine the RBA about whether it is confident that the current monetary policy settings will effectively encourage growth and inflation consistent with the target for coming years.’

Public Hearing Details 

Committee: House of Representatives Economics Committee
Venue: SMC Conference & Function Centre, Ionic Room (ground floor)
66 Goulburn Street Sydney
Date:Friday, 12 February 2016
Time: 9.30am to 12.30pm
Webcast: The hearing will be webcast (audio only) http://webcast.aph.gov.au/livebroadcasting/

ENDS

WITH the shifting sands on tax reform and the GST debate wavering, talk of losing work related deductions is a genuine threat to taxpayers’ rights, according to the Institute of Public Accountants (IPA).

The House of Representatives Economic Committee is currently investigating trading tax deductions for lower tax rates and is due to report at the end of February.

“While a reduction in personal income tax is an attractive proposition to most people, it will not compensate the majority for the loss in having the right to claim legitimate work related deductions,” said IPA chief executive officer, Andrew Conway.

“Under such a proposal, up to nine million Australian taxpayers would lose their existing ability to claim deductions relating to expenses incurred in earning their income; a fundamental entitlement under our tax system.

“And employees should not be under the false assumption that employers will pick up the slack.  Most businesses in Australia are small businesses who can ill afford to fund the shortfall.

“Small businesses in particular will be affected where an employee chooses not to buy tools of trade, such as mobile phones and laptops, because they will no longer be able to claim them as a legitimate deduction. 

“Loss of essential tools of trade will lead to further deterioration of Australia’s already declining productivity.

“Taxpayers may not be aware that self-education expenses are a component of work related deductions.  Any talk of losing the ability to claim a deduction for self-education is contrary to the Government’s push for innovation,” said Mr Conway.

About the Institute of Public Accountants

The IPA, formed in 1923, is one of Australia’s three legally recognised professional accounting bodies.  In late 2014, the IPA acquired the Institute of Financial Accountants in the UK and formed the IPA Group, with more than with more than 35,000 members and students in over 65 countries.  The IPA is a member of the International Federation of Accountants, the Accounting Professional and Ethical Standards Board and the Confederation of Asian and Pacific Accountants.  The IPA was recognised in 2012 as Australia’s most innovative accounting organisation and listed in the top 20 in the 2012 BRW Most Innovative Companies List.   

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