NEWS ARTICLES

Dear Member of the Australian Federal Parliament,

We, Aust Phil Chamber of Commerce, Inc., are writing to present a set of formal policy proposals aimed specifically at improving the profitability, resilience, and long-term viability of Australia’s small business sector. Small businesses are the backbone of the Australian economy, employing millions of Australians and driving innovation, competition, and community vitality. However, they continue to face rising costs, labour shortages, regulatory burdens, and economic uncertainty.

The following proposals are designed to strengthen small business profitability through practical, targeted, and economically sound reforms.

Policy proposals to improve small business profitability in Australia

1. Tax reform to improve cash flow

Small businesses operate on tight margins and require strong cash flow to grow. Key reforms include:

• Making the instant asset write-off permanent and significantly increasing the threshold.
• Introducing a reduced small business company tax rate for reinvested profits.
• Expanding simplified depreciation rules.
• Providing targeted tax credits for digital adoption, automation, and cybersecurity.

These measures directly improve profitability by reducing tax pressure and encouraging investment.

2. Reducing regulatory burden

Compliance costs disproportionately affect small businesses. Reforms should include:

• A national small business regulatory portal consolidating federal, state, and local requirements.
• Automatic sunset reviews for outdated or duplicative regulations.
• Streamlined licensing and permit processes.
• Simplified reporting obligations for micro-businesses.

Reducing red tape frees up time and resources for growth.

3. Lowering energy costs

Energy is a major cost driver for small businesses. Policies should focus on:

• Incentives for energy-efficient equipment upgrades.
• Access to long-term, stable energy contracts.
• Grants for solar, battery, and electrification projects.
• Faster rollout of renewable and firming infrastructure.

Lower energy costs improve margins and competitiveness.

4. Addressing labour shortages

Small businesses struggle to compete for skilled workers. Solutions include:

• Fast-tracked skilled migration for small business-critical occupations.
• Wage subsidies for apprentices and trainees.
• Government-funded micro-credential programs aligned with industry needs.
• Incentives for part-time workforce participation, including childcare support.

A stronger labour pipeline boosts productivity and profitability.

5. Improving access to finance

Small businesses often face higher borrowing costs. Government can:

• Expand the SME loan guarantee scheme.
• Support alternative lending platforms.
• Encourage banks to offer lower-cost small business credit products.

Better access to finance enables growth and investment.

6. Strengthening competition in key input markets

Small businesses face higher costs due to concentrated markets in banking, insurance, energy, and supermarkets. Reforms should include:

• Stronger ACCC powers to investigate anti-competitive conduct.
• Mandatory transparency in wholesale pricing.
• Incentives for new entrants in concentrated sectors.

More competition reduces input costs and improves profitability.

7. Supporting digital transformation

Digital capability is essential for modern competitiveness. Policies should include:

• Grants for digital adoption, e-commerce, and automation.
• Subsidised cybersecurity upgrades.
• National digital-skills training for small business owners.

Digital transformation increases efficiency and reduces operating costs.

These proposals aim to create a more competitive, productive, and resilient environment for small businesses. By reducing costs, improving efficiency, and encouraging investment, Australia can strengthen the profitability and long-term sustainability of its small business sector.

Thank you for your consideration. We would welcome the opportunity to discuss these proposals further.

Sincerely,
Jun Capili
APCCI President

Dear Federal Member of Parliament,

We, from Aust Phil Chamber of Commerce, Inc., are writing to formally express our strong opposition to the Australian Government’s proposed changes to capital gains tax (CGT) and negative gearing. We respectfully urge you, as our representative, to oppose these measures in Parliament and advocate for policies that genuinely support housing affordability, rental supply, and economic stability.

Our concerns are grounded in economic evidence, historical experience, and the practical realities faced by both investors and renters.

1. The proposed restrictions on negative gearing will reduce rental supply. Limiting negative gearing to new builds discourages investment in established housing, where most renters live. Reduced investor participation will tighten vacancy rates and place upward pressure on rents.
2. The changes distort investment incentives. Forcing investors into new builds creates an artificial bias in the market, increases risk exposure, and undermines efficient capital allocation.
3. Replacing the 50% CGT discount with inflation-based indexation and a minimum 30% tax rate will increase the tax burden on long-term investors. This discourages stable, long-term investment and adds administrative complexity.
4. Grandfathering the reforms creates a two-tiered system. Existing investors retain full benefits while new investors face harsher rules, undermining fairness and creating market distortions.
5. The reforms do not address the true drivers of housing unaffordability. Planning delays, zoning restrictions, construction bottlenecks, and rapid population growth are the primary causes of supply shortages. Tax changes alone cannot resolve these structural issues.
6. Small investors, who provide the majority of rental housing, will be disproportionately affected. Reduced participation from this group will shrink rental supply and increase reliance on institutional landlords.
7. Sudden tax changes risk destabilising the housing market. Reduced investor confidence can lead to fewer housing starts, lower construction activity, and broader economic impacts.

For these reasons, we respectfully request that you oppose the proposed CGT and negative gearing changes and instead support policies that expand housing supply, streamline planning processes, and encourage investment across all segments of the market.

Thank you for your consideration. We would welcome the opportunity to discuss this matter further.

Sincerely,
Jun Capili
APCCI President