The Business Council is calling for all sides of politics to put forward new policies to support businesses to grow, following recent briefings in the United States on the incoming administration, uncovering significant potential risks and opportunities for Australian businesses.
Business Council chief executive Bran Black, and other representatives, have just left Washington D.C. where they met with industry representatives and officials to discuss the impact of proposed policies from the incoming US administration.
Mr Black said Australia is at risk of losing business investment, jobs and tax revenue to the United States, with new pro-business polices likely to make Australia a less competitive place to do business.
“After hearing directly from senior business industry representatives in the United States, it’s clear that without new pro-business policies, we are at risk of seeing investment dollars drained out of Australia,” Mr Black said.
“We’re calling on all sides of politics to put forward new policies to improve Australia’s competitive settings, including on deregulation and faster approvals, and which address our tax settings, including with an investment allowance and an improved Research and Development Tax Incentive.”
Major business industry representatives in the United States reported to the BCA:
“Australia now has six times the compliance costs of some competitors.”
“Australia is now a less welcoming place to do business.”
“We have a number of businesses looking to restructure out of Australia and take their investment elsewhere, particularly to places like Singapore”
Mr Black noted the incoming United States administration has plans to fast track approvals for investments of over $1 billion, significantly reduce regulation and lock in a federal company tax rate no higher than 21 per cent.
“The race for investment is global and the last time the United States dropped its company tax rate Australia became a net exporter of capital for five years, effectively missing out on critical projects and jobs.”
Australia has the third highest company tax rate in the OECD, ahead of only Portugal and Colombia.
The BCA’s Australia’s flagging competitiveness and productivity report found Australia is becoming a harder place to invest and that productivity growth over the past decade is the lowest in sixty years.
The BCA has welcomed the Commonwealth’s National Productivity Fund, which reflects the model put forward by the BCA. The design of the fund is intended to incentivise states and territories to deliver reforms that support productivity growth.
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