Growing our aspirational small advanced manufacturers requires a better understanding

Growing our aspirational small advanced manufacturers requires a better understanding

The Australian Advanced Manufacturing Council says the Opposition Budget reply appears to have ignored the realities of global competition in suggesting that small businesses must be defined as those with $2 million or less in annual turnover.

“Mr Shorten needs to get in touch with small business.  He is wrong to limit small business to those with turnover under $2 million,” Chairman of the AAMC, Mr John Pollaers, said today.

“The Government’s decision this week to raise the threshold to $10 million will add an estimated 60,000 businesses to the existing 810,000 businesses in the small business category,” Mr Pollaers said.

“Those additional 60,000 businesses employ an estimated additional 1.5 million Australians,” he said.

“This is almost doubling the number of employees – to an estimated 3.4 million Australians – whose enterprises will be given full and reasonable benefit from ATO allowances for small business,” he said.

“Suggesting that small enterprises are those with turnover under $2 million a year is out of step with the rest of world and significantly limits Australia’s potential in what is an increasingly competitive business landscape globally,” he said.

By contrast, in the European Union, a small business is one with less than 50 employees and also an annual turnover of below 10 million Euros; in the US, a small business employs up to 500 employees.

“For advanced manufacturers seeking to become global suppliers, scale is an issue,” Mr Pollaers said.

“Their customers must have trust in their viability in the long term,” he said.

“Of course billion-dollar operations are not small businesses.

“We are speaking about small enterprises who are the major employers in Australia,” he said.

The Government has indicated that from 1 July 2016, there will be a cut from 28.5% to 27.5% for incorporated businesses with turnover of $10 m or less (up from $2 m threshold).

“Our recommendation was to raise the threshold to $20 million,” Mr Pollaers said.

“There is no question that for Australian companies to compete globally, they must demonstrate viability to their customers – they are required to invest heavily in skills development, in process technologies, in new product development – and they must supply higher value products into a highly competitive global economy,” Mr Pollaers said.

“Ensuring these companies – who are major employers – enjoy small business support and a lower company tax rate simply acknowledges the challenges they face, and helps their growth and viability into the future,” he said.

“We called for an increase of the threshold to $20 million turnover in our Pre-Budget Submission. Revising the threshold upwards better reflects the viability of small business in Australia if it is to survive the onslaught of global competition.

“Lowering the corporate tax rate over time supports Australia’s aspirational advanced manufacturers as they work to commercialise our home-grown ingenuity and make a name for Australia in the world,” Mr Pollaers said.



Jennifer Conley

Executive Director


M: 0406 857 856


Caroline Hartnett


M: 0408 897 577

2016-05-10T07:08:42+10:00 May 10th, 2016|