Small businesses in South Australia have accused the government of turning its back on them, after it failed to take steps in the latest state budget to adequately address their concerns.
As seen at the troubled Carringbush in Victoria, the weight of rising costs coming from multiple directions means more businesses will be forced to close.
Owner of The Duke of Brunswick Hotel in Adelaide, Simone Douglas, who owns three other businesses, was recently forced to sell one.
Despite cutting costs where possible, including making energy efficiency changes, bills were still high. Douglas reports that even with these changes, all business profits went to the tax bill last year.
“I’m back working in the venues. I’ll be working an eight-hour shift today on the public holiday because we can’t justify paying someone double time,” she told Channel 7.
In a similar situation, Adelaide restaurant Gang Gang is closing its Parkside venue this weekend, citing payroll tax as one of its largest business costs.
Under the current regulations, businesses in South Australia pay a variable payroll tax fee ranging between 0 to 4.95 per cent if paid wages exceed $1.5 million.
Both the South Australian Business Chamber and the opposition believe the threshold should increase to $2.1 million, as well as a tax exemption granted for trainee employees.
The SA Business Chamber advised that due to recent significant wage increases, this year up to 20 per cent of South Australian businesses would be paying payroll tax for the first time.
Shadow Finance Minister Heidi Girolamo believes that operating in the current market has become financially unviable and unsustainable for businesses, and the budget has not gone far enough to address this.
“We call on the government to do more, to do better to support South Australian businesses,” she said.
The new budget offers a grants scheme to assist businesses in investing in energy efficiency, which replaces the previous rebate scheme.
Gang Gang owner Morgen Wynn-Hadinata pointed out this grant would be unlikely to be used by businesses that did not own their premises.
There is also nothing in the budget to assist operators who have already made energy efficiency changes.
In response, SA Deputy Premier Susan Close defended the budget policy.
“There is no evidence that lowering the payroll tax would translate into an increase in employment.”
