Super deferrals, tax cuts proposed to help SMEs

The Australian Small Business and Family Enterprise Ombudsman Kate Carnell has asked the federal government to help take some financial pressure off small businesses that have been suffering from the COVID-19 pandemic without adversely impacting workers.

The Ombudsman has suggested the deferral of superannuation guarantee increases for two years and cutting the 15 per cent tax on compulsory employer superannuation guarantee contributions to 7.5 per cent for the same period of time.

In a letter to the federal Treasurer, Carnell points out that the combined measures offset each other, ensuring that workers end up with a similar superannuation amount as they would have under the increase scheduled before COVID hit.

“We have to get the balance right by ensuring small businesses aren’t hit with rising costs and workers are no worse off,” Carnell said. “Many small businesses are already struggling to stay afloat as a result of the COVID-induced recession and cannot afford to pay higher costs. These increased costs would put small business owners under even more financial strain, placing jobs and businesses at risk.

“It is equally important to safeguard the long-term financial future of Australians through superannuation,” Carnell added. “Our modelling shows our proposed tax cut would cost the Government no more than $6 billion per year and would also support struggling small businesses and help the millions of Australians who used the early access to superannuation program to start restoring their long-term super balance.”

Carnell said that by implementing this proposal, the federal government would be supporting small businesses and every Australian, giving them the chance of a dignified retirement.”

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