Tonight’s Federal Budget marks a crucial point in the road to recovery following the COVID recession.
It is being billed by the Treasurer as a ‘jobs Budget’ with an aim to drive the unemployment rate below the current 5.6 per cent level. As the second-largest workforce in the Australian economy, retail has more skin in the game than most industries when it comes to safeguarding jobs. From small family-run businesses through to nationwide chains, the retail sector provides employment opportunities to Australians of all age groups and demographics. The performance of our sector over the coming period will be instrumental in determining how successful an economic recovery Australia achieves.
The current economic turbulence was further underlined by yesterday’s ABS report for March. Although there was a solid 1.3 per cent monthly rise, retail sales volume for the March 2021 quarter was down 0.5 per cent on last year. Put another way, consumers are beginning to return to pre-pandemic shopping patterns and are slowly cutting back on discretionary spending. It should be noted that this is not surprising, shoppers were never going to splurge at the levels they did late in 2020 forever. However, what we don’t want is for discretionary purchases to plummet in a manner that jeopardises businesses and jobs.
Which is why we hope that the mooted rollover for a further 12 months of the tax offset for people earning up to $90,000 occurs. People in this income bracket tend to spend whatever surplus money they have from their pay cheque after making essential purchases. The more disposable income they have, the more likely they are going to keep the economy ticking along with purchases ranging from a morning coffee to new household appliances.
The NRA is also very pleased to hear that the Federal Government will enable small businesses to apply to the Administrative Appeal Tribunal (AAT) to pause or modify debt recovery actions. Currently, the only avenue for small businesses to dispute matters of this nature with the ATO is via the court system which tends to be costly and time consuming. Applying directly to the AAT will save thousands of dollars and reduce the time taken for a decision by as much as 60 days.
Small business is the lifeblood of the economy and taking these disputes away from the courts is a common-sense solution at a time of continued upheaval. Any of you with an aggregated turnover of less than $10 million per year will be eligible for this approach. If you would like any further information on this, then please don’t hesitate to contact the NRA team.
All the best for the week ahead.