Small business not in favour of a Capital Gains Tax: survey

Dissatisfaction with the Government's performance is rising with small firms. Photo / 123RF

Small and medium sized businesses strongly oppose a Capital Gains Tax, according to industry research conducted in March.

MYOB's annual business monitor shows 67 per cent of the 1000 small businesses surveyed said they were against the Tax Working Group's proposal.

Around 48 per cent of those surveyed said they were strongly against the proposed introduction of a tax on profits made from the sale of assets including land, shares, investment property, business and intellectual property.

An additional 19 per cent said they were against the proposal.

Just 20 per cent of small firms said they supported it.

Businesses in the rural regions were the most opposed to a Capital Gains Tax, along with those involved in the agriculture, forestry and fisheries sector.

Other sectors strongly against the potential tax were business, property and professional services industry, and the finance and insurance sector.

Manufacturing and wholesale sectors were the most supportive of it.

Younger business operators were generally more supportive of a Capital Gains Tax when compared to Gen Y and Z operators.

The research shows dissatisfaction with the Government's performance has risen sharply among small businesses over the past year, with nearly half of all businesses unimpressed. Just 26 per cent said they were happy with how the coalition government had been tracking since the election.

MYOB country manager Ingrid Cronin-Knight said the lack of clarity around Capital gains Tax policy was likely affecting businesses.

"I'm not sure the Government will ever win over the majority of businesses with a capital gains tax – but at the moment, the way the proposal has been communicated has created real concern among SME operators," Cronin-Knight said.

"Uncertainty around the potential costs of implementation and compliance, and the complexity of valuing their assets has created a climate of fear around the proposed new tax."

The survey revealed an overarching demand from small business operators was the Government needed to provide clearer direction, she said.