A leading business group believes small firms have suffered more under a carbon pricing regime than their larger counterparts.
The Australian Chamber of Commerce and Industry’s latest small business survey for the December quarter shows firms continue to face difficult conditions and are less upbeat than larger companies.
Profits, sales and employment remain weak and as a result investment continues to struggle.
Business taxes and government charges are seen as the number one constraint on small business investment for a 12th successive quarter, which the chamber says demonstrates the need for tax reform as a priority.
Its acting chief economist Burchell Wilson said the government’s focus on repealing the carbon tax was appropriate, adding the impost was a key factor undermining small businesses.
Energy-intensive, trade exposed industries and households were provided with compensation when the carbon tax was introduced, he said.
“Small businesses on the other hand were provided with absolutely no compensation … largely on the assumption that they would be able to pass this cost on to consumers,” he told reporters in Canberra on Monday.
“There wasn’t a lot of evidence to support that assumption.”
The latest survey showed the small business conditions index rising to 43.2 points for the final three months of 2013 from 42.5 points in the September quarter but remaining below the 50-mark that separates contraction from expansion.
Sales revenue remained in contraction, recording the longest period below 50 in the 18-year history of the survey, while the profits index was a limp 36.2 points.
The one positive was a second consecutive rise above 50 points for expected economic conditions.