THE Australian Small Business and Family Enterprise Ombudsman Kate Carnell is calling on banks to make “least cost routing” available to small business as a matter of urgency.

Ms Carnell said small businesses would benefit if banks adopted least cost routing, sending tap-and-go payments via the cheapest payment pathway to limit the costs incurred by merchants.

“Australian banks have been doing some good work to support small businesses throughout the COVID-19 crisis,” Ms Carnell said.

“Banks have an opportunity to build on this now, by making least cost routing readily available to small businesses for tap-and-go payments.

"It’s estimated about $30 million in extra fees were paid by merchants during March, due to banks directing debit card contactless payments to global companies such as Visa and Mastercard.

“For too long, small businesses have been slugged with unnecessarily high fees from credit card networks, when there is a cheaper option,” Ms Carnell said.

“This is particularly unfair when many small businesses are trying to get back on their feet, with coronavirus restrictions lifting.

“Small businesses are being disproportionally hit by fees, with larger retailers able to bypass full fees by using payment systems directly or by having the market power to negotiate least cost routing with their banks," Ms Carnell said

“There has been plenty of time for the banks to implement these changes. It has been two years since the major banks were directed by Federal Parliamentary committees to embed least cost routing in the merchant services plans they advertise to retailers.

“The banks need to do the right thing by Australian small businesses in this economic crisis and deliver least cost routing as a universal service.

“As of July, Eftpos has announced it will cut the standard wholesale interchange fee paid by small businesses in half to 2 cents for tap-and-go transactions that are routed to Eftpos. Roll-out of least cost routing should be a priority for the banks.” 

www.asbfeo.gov.au

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EVEN BEFORE the COVID-19 pandemic, Australia’s small businesses were feeling stressed by the bushfire devastation and every day cost pressures.

Data from the Sensis Business Index, which measures small business confidence, shows a massive drop in confidence in just two weeks as the reality of Coronavirus hit Australia. Confidence fell from positive 40 on March 10 to negative 13 on March 24.

“Australia’s small businesses were feeling the squeeze before the impact of the Coronavirus hit,” said Sensis CEO John Allan. “But the massive fall in confidence in just a matter of 14 days, while not a surprise, was the fastest drop in the 25-year history of the survey."

The first survey respondents were in early March but as time progressed the stark reality of COVID-19 hit Australia’s small businesses quickly with sentiment changing mid-survey. At the start of March, 29.7 percent of SMBs had seen no impact on their business with 35.6 percent expecting to see an impact in the coming months. 

By the third week of March, 32 percent had seen a severe impact, 35 percent had seen some impact and 26 percent were expecting an impact.

“The extraordinary speed of the change in confidence is not something we’ve ever witnessed before; it was as if a speed train had hit the majority of small-medium businesses in Australia with 47 percent surveyed now worried about the future," Mr Allan said..

“Despite the realities of lockdown, more than one-third (34%) of small businesses were showing resilience and still confident about the future, suggesting they are hopeful about a quick bounce back post lockdown,” Mr Allan said.

Small businesses across the country were not confident about the economy going into lockdown: 64 percent believed the economy had contracted and 30 percent believed it had stalled; 60 percent believe the economy will be in worse shape in 12 months.

Around the country

In terms of the state and territory economies, 57 percent of SMBs believe their state economy is shrinking, and 35 percent believe it is at stand still.  South Australian SMBs were most pessimistic with 67 percent feeling the SA economy was shrinking.

“ACT small businesses were the most confident (47.3% were confident) while South Australian SMBs were the most pessimistic (52.3% not confident).”

In the March quarter nearly one-third (30%) of SMBs saw the value of their goods or services decline and 44 percent reported that the prices they pay for goods and services they use increased during the quarter.

SMB Confidence:

Survey Details:

The Sensis Business Index is based on 1,015 online interviews conducted between March 4 and 28, 2020 with small and medium business proprietors or managers employing up to 199 people. This sample is drawn from metropolitan and major non-metropolitan regions throughout Australia with targets set for location and industry on page 36. Glow is responsible for fieldwork and Dynata for sampling.

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THE CO2 Cooperative Research Centre (CO2CRC) has welcomed the Federal Government’s embrace of science and technology as the pathway to accelerating low emissions technologies and its identification of carbon capture utilisation and storage (CCUS) as a priority low emissions technology.

CO2CRC chief executive, David Byers said the Technology Investment Roadmap provided a "powerful endorsement of the potential for CCUS to play a vital role in meeting the dual challenge of supplying more energy but with fewer emissions".

Mr Byers said, “As International Energy Agency executive director, Dr Fatih Birol declared earlier this year: ‘When we consider the scale of the energy and climate challenge, the critical importance of carbon capture is inescapable.’

“In that context, Australia is well-placed to be a world leader in CCUS. Recent project activity demonstrates to the nation that CCUS is not a dream for the future but a reality today,” Mr Byers said.

“The world’s largest commercial-scale carbon dioxide injection project commenced in August 2019 at Gorgon LNG on Barrow Island, off the northwest coast of WA. Gorgon is now progressively ramping up to full capacity of up to 4Mtpa of safe and permanent storage of CO₂. 

“Santos is at an advanced stage of examining a large-scale commercial carbon capture and storage (CCS) project to be located in the Cooper Basin with a scalable potential to store up to 20 Mtpa of CO₂ per year.

 “The launch of the Hydrogen Energy Supply Chain pilot project in Victoria has been another leap forward for CCUS in Australia. The CarbonNet Project is investigating the feasibility for a commercial-scale, multi-user CCUS network in Gippsland that will inject CO₂ -- including that ultimately produced from commercial-scale hydrogen production -- into deep underground, offshore storage sites in Bass Strait. In January, CarbonNet reached an exciting phase with the conclusion of a successful offshore drilling appraisal well at the Pelican site.

“Finally, COAL21 is examining the development of a commercial scale CCUS project in Queensland’s Surat Basin with a final investment decision to begin construction of a $150 million carbon capture plant at the Millmerran Power Station scheduled for later this year.

“Together, this project activity demonstrates once again that CCUS is not experimental – it is a proven technology, currently being deployed, storing millions of tons of CO₂. On a global scale, more than 200 million tonnes of CO₂ have been captured and injected deep underground since the 1970s. One project - the Sleipner CCS operation in Norway has separated and injected about one million tonnes of CO₂ per year since 1996," Mr Byers said.

“Today, 19 large scale CCS facilities are operating globally and another four are in construction.

The challenge is to continue to improve the cost-effectiveness of CCUS and develop the right policy settings for further investment.  

“The value of CCUS is its versatility as a technology. Its applications extend to industrial processes such as cement, iron and steel. Emissions in these sectors are hard to abate due to inherent process emissions and high temperature heat requirements.

"Earlier this month, Equinor, Shell and Total signed off on the Northern Lights Project - a plan to build a carbon capture network that will capture 5 million tonnes of CO₂ per year from various industrial sites including a major Norwegian cement production plant and a large waste to energy plant in Oslo. CO₂ emissions will be transported via ship and pipeline to an offshore storage reservoir in the Northern North Sea. Final go ahead for the project is subject to Norwegian Government investment and regulatory approvals,” he said. 

Mr Byers also highlighted the $194 billion export value of Australia’s coal, LNG and iron-ore resources in 2018-19.

“It is in Australia’s national interest to take advantage of all our natural energy resource endowments to enhance economic prosperity. CCUS has an important and unique role to play in reducing emissions from industrial processes vital to Australia’s economy like gas processing, steel and cement production

“CCUS can play a vital role in helping Australia achieve continued economic prosperity while meeting international emissions reductions commitments. The reality is that, over the long-term, there is unlikely to be a cost-effective emissions reduction response without CCUS.

"As the Technology Investment Roadmap points out, Australia is also well-placed to leverage its CCUS scientific and industry knowledge and experience to help neighbours in the Asia-Pacific region meet their low emissions targets.” he said.

www.co2crc.com.au

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THE Parliamentary Joint Committee on Intelligence and Security (PJCIS) has commenced a review into the effectiveness of the Australian Security Intelligence Organisation Amendment Bill 2020. The bill review was requested by the Minister for Home Affairs in a letter to the Committee available here.

The Bill amends the compulsory questioning framework in the ASIO Act by:

• enabling ASIO’s continued use of questioning warrants, but removing its ability to use questioning and detention warrants;
• replacing the existing detention framework with a more limited apprehension framework; 
• enabling the use of questioning warrants in relation to espionage, politically motivated violence (including terrorism) and acts of foreign interference; 
• providing the power for a police officer to conduct a search of a person who is apprehended in connection with a questioning warrant; and
• permitting ASIO to seek a questioning warrant in relation to minors aged 14 to 18 years old, but only where the minor is themselves the target of an ASIO investigation in relation to politically motivated violence 

The Committee requests submissions to the inquiry by Friday June 26, 2020.

Prospective submitters are advised that any submission to the Committee’s inquiry must be prepared solely for the inquiry and should not be published prior to being accepted by the Committee.

Further information about making a submission to a committee inquiry can be found at the following link.

Further information on the inquiry can be obtained from the Committee’s website.

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THE Tax Practitioners Board (TPB) is warning the community and businesses to take extra care when seeking assistance in accessing the Federal Government’s COVID-19 stimulus measures.

This follows the identification of a growing number of complaints and intelligence about fraudsters posing as tax experts, providing misleading advice and support relating to COVID-19 stimulus benefits, often provided on a ‘no benefit – no fee’ basis.

The arrangements are often promoted through social media channels, claim to offer advice and support along with unnecessary services in a subscription or locked-in contract. Some of these arrangements involve businesses with thousands of clients. T

he organisations involved may claim that the advice being provided is ‘assured’ by a registered tax agent. That advice may be incorrect and breach the Tax Agent Services Act (TASA).

The TPB will prioritise investigations into organisations who have been involved in such conduct.

Often, an agreement may require the client to provide personal or confidential information including Tax File Numbers or MyGov ID logins. Unregistered service providers however, often have poor IT and security controls and are susceptible to identity theft.

TPB chair, Ian Klug said, "We are investigating organisations operating in this way to establish how, and which, services are being provided and whether they are in contravention of the law.

"We are concerned about protecting the consumers of taxation services as we know the accuracy of the advice given by unregistered agents is not reliable and there is no safe way to ‘assure’ advice by an unregistered tax adviser simply by involving a registered agent on the fringe of the business. Incorrect advice may prevent the full amount of the benefit from reaching its intended recipients.

"Also, incorrectly received benefits may have to be repaid and recipients may be liable for penalties and interest."

TPB is urging community to check whether their tax practitioner is registered on the public register at www.tpb.gov.au/onlineregister and follow the TPB’s tips when seeking taxation or COVID-19 stimulus advice.

Mr Klug said, "If you are not a registered practitioner and your business is engaged in providing advice or services related to any of the COVID-19 stimulus benefits such as Jobkeeper, Cash Boost or Early Release from Super, you are in breach of the TASA and may be liable for a civil penalty imposed by the Federal Court."

Any small business or individual unwittingly caught up in unfair contracts with businesses offering ‘assured’ tax services should seek legal advice.

If buisness leaders become aware of a potential scam or unregistered tax practitioner, report the situation to the TPB either This email address is being protected from spambots. You need JavaScript enabled to view it. or by calling 1300 362 829 (select option 5). All reports will be treated in the strictest confidence, Mr Klug said.

About the Tax Practitioners Board

The Tax Practitioners Board regulates tax practitioners in order to protect consumers. The TPB aims to assure the community that tax practitioners meet appropriate standards of professional and ethical conduct. Twitter @TPB_gov_au, Facebook and LinkedIn.

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The Australian Taxpayers' Alliance today released a policy paper outlining five proposals for economic recovery in a post-COVID-19 Australia.

The ATA recommends:

1. Deregulation: Use cuts to red tape as a fiscal stimulus to jump-start the economy post-COVID-19.
2. Decentralisation of Power: Shrink the government back to its original size and put more power into the hands of the Australian people.
3. Taxation: Implement structural tax reform and get rid of government waste caused by inefficient and costly taxes.
4. Domestic Economy: Promote local manufacturing by making Australia globally competitive, not by instituting protectionism policies.
5. Superannuation: Keep the increased superannuation flexibility and give Australians more power over their retirement savings.

"Through this plan, we aim to identify waste so that the government can contain the deficit -- without increasing the burden on taxpayers or harming the economy," ATA policy director, Emilie Dye said.

“Policymakers can use this crisis to pinpoint weaknesses in Australia's tax and regulatory systems and then use the current momentum to push real structural reforms.

"Australian politicians have a choice: they can tax more, regulate more, and otherwise expand their powers, or they can use this disaster to restructure our tax and regulatory codes and put more power in the hands of the people.

"COVID-19 has disrupted people's lives, the economy, and government coffers in ways no one could have predicted. Policymakers have had to institute dramatic changes. But as we ease back into normalcy, we cannot become compliant,” said Ms Dye. “An overly authoritarian government and a dangerous debt still threaten the Australian public. Australian politicians need to make smart reforms now.”

[Read the full policy here]

Emilie Dye commented on each policy point: 

Deregulation: Use cuts to red tape as a fiscal stimulus to jump-start the economy post-COVID-19

“Cutting red tape can act as one of the most effective forms of fiscal stimulus. By reducing regulation, we can cut costs for both businesses and taxpayers.

“Regulation is the kryptonite of innovation. Businesses need all the strength they can get to recover from this crisis, and our government agencies need to focus all their resources on recovery.

“COVID-19 has revealed regulations Australia doesn't need, like restrictions on operating hours and redundant licenses that do not make consumers any safer. The state and territory government would be stepping backwards if they were to reinstate these archaic restrictions.”

Decentralisation of Power: Shrink the government back to its original size and put more power into the hands of the Australian people

“Australians have lost many of their fundamental rights during this crisis, and the state police departments have collected millions in fees for their governments. With on the spot fines and judge only trials, Australians have been treated like criminals who need to prove their innocence.

“We need to return to being a society that treats people as innocent until proven guilty. Australian's deserve to have their voices heard both in Parliament and in the courtroom.”

Taxation: Implement structural tax reform and get rid of government waste caused by inefficient and costly taxes

“Over the years, Australia has collected a cocktail of taxes, some of which are toxic to the economy. By cutting wasteful and inefficient taxes like the stamp duty, payroll tax, and the corporate tax, the government could spur economic growth and increase the tax take in other areas.

“To contain the debt, the government doesn't need to tax more; it needs to tax smarter.”

Domestic Economy: Promote local manufacturing by making Australia globally competitive, not by instituting protectionism policies

“COVID-19 uncovered the corpse of our manufacturing industry. Australia faced painful supply chain shortages that showed our nation's over-dependence on China.

“Instead of arguing for policies that would supposedly ‘protect’ Australian industry from foreign competition, we should make Australia globally competitive. Australian businesses don't have a fighting chance against foreign corporations, because we have handicapped ourselves with high taxes, unnecessary regulations, and inefficient bureaucracies.”

Superannuation: Keep the increased superannuation flexibility and give Australians more power over their retirement savings

“We can walk away from COVID-19 with a healthier, more resilient Australia, or the government can rigidly attempt to manage the lives and finances of every Australian. It's time we gave Australians power over and access to their own superannuation funds.

“Only individual Australians know best how to save and spend their own hard-earned money. Scott Morrison has temporarily allowed Australians to access up to $10,000 of their super tax-free. Let's make that change permanent.”

About the ATA

The Australian Taxpayers' Alliance is the nation’s largest grassroots advocacy group representing the everyday Australian taxpayer. Through our campaigns, we fight to oppose over-regulation, wasteful spending and burdensome taxes. ATA's mission is to transform our nation and build a better, freer, and more prosperous Australia.

www.taxpayers.org.au

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DREAMWORLD today welcomed the joint announcement by Queensland Premier, Annastacia Palaszczuk, and State Development, Tourism and Innovation Minister Kate Jones of an extra $50 million to help support the tourism industry and, in particular, the state's iconic theme parks.

“There is no doubt the past few months have been incredibly difficult for all Australians and our industry has certainly experienced this as well," Dreamworld chief executive officer, John Osborne said.

"A cash injection of the kind described in the announcement by the Premier and Minister Jones is most welcomed and will greatly assist us as we move into the post COVID-19 environment," Mr Osborne said.

“We are pleased the government has recognised the significant role our parks play in both the tourism and local economies, and Dreamworld looks forward to working with the government to ensure our businesses recover, unite and grow stronger post COVID-19."

www.dreamworld.com.au

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THE Joint Committee of Public Accounts and Audit will be holding a public hearing for its Inquiry into Cyber Resilience, based on Auditor-General’s Report No. 13 (2019-20), Implementation of the My Health Record System, and Report No. 1 (2019-20), Cyber Resilience of Government Business Enterprises and Corporate Commonwealth Entities.

The public hearing is scheduled for Tuesday, May 19..

The Committee will also be holding public hearings for its Inquiry into the Defence Major Projects report, Auditor-General’s Report No. 19 (2018-19), and Auditor-General’s Report No. 22 (2019–20), Future Submarine Program—Transition to Design.

The public hearings are scheduled for the following dates:

-       Wednesday, May 20, which will consider in detail Auditor-General’s Report No. 22 (2019-20) and related matters

-      Wednesday, May 27, which will examine Auditor-General’s Report No. 19 (2019-20) and related matters

Further information about the inquiry is available on the Committee’s website.

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