Small business: A bit short of the mark

By ELLEN READ

The Budget's initiatives for small- and medium-sized companies have received a mixed scorecard - nice to be recognised and have specific announcements but they don't quite hit the mark.

"There's not a lot of extra funding for such an important employer section," said Brett McIlroy, of Mt Roskill-based Turkish Kitchen, which makes GE-free spreads, dips, meals, soups and desserts.

He was referring to the build-up the Government gave the sector - that companies employing fewer than 20 people make up 97 per cent of all companies, employ 43 per cent of all workers and produce 39 per cent of all goods and services.

"They're setting up ways to help us cope with the legislation rather than simplifying it so we don't have so much in the first place."

As for the small-to-medium enterprise (SME) summit set down for next year, "Yeah, we'll work it into our holiday" was McIlroy's tongue-in-cheek response.

While applauding the Government's steps to simplify the tax burden for small businesses, he suggested easing the initial financial burden of taking on staff, rather than delaying tax payments - which many firms don't have to make in their early years anyway.

McIlroy and wife Luciell bought the Turkish Kitchen two years ago from Haluk Cil, a Turkish doctor who emigrated to New Zealand. Working alongside the couple are six staff, who hand-make the food in the factory, as well as a driver and a sales rep.

Auckland Chamber of Commerce chief executive Michael Barnett said the SME tax proposals clearly demonstrated the Government's knowledge of the compliance burden on business and a commitment to lower that cost.

"SMEs will be delighted with the proposed concepts but frustrated that they are only concepts and part of more discussion instead of actions to be implemented immediately".

He also warned that while some of the concepts would ease the cash-flow pressures of SMEs, they would also introduce new pressures of debtor management.