12/07/2019 - 10:58

WA business confidence falls again

12/07/2019 - 10:58

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Western Australia’s business confidence has fallen for the second quarter in a row, which the Chamber of Commerce and Industry of WA says indicates the need to reduce WA’s payroll tax.

WA business confidence falls again
Business confidence in WA is down 13 per cent since December 2018.

Western Australia’s business confidence has fallen for the second quarter in a row, which the Chamber of Commerce and Industry of WA says indicates the need to reduce WA’s payroll tax.

According to the latest WA Super–CCI Business Confidence survey, business confidence in the state is down 13 per cent since December 2018.

CCI chief executive Chris Rodwell said the overall decline in confidence over the short term, combined with plans by 72 per cent of businesses to reduce their staff levels or keep them the same, was a worrying sign for WA’s economic recovery.

“With four out of five jobs created by business in WA, the state government needs to be doing everything it can to support businesses to grow and create jobs,” Mr Rodwell said.

“Every other state understands the importance of reducing payroll tax so small businesses can hire more people, which is why we are left with the highest payroll tax burden in the country.

“Just two months ago Queensland increased its payroll tax threshold by $200,000 to $1.3 million at the same time that the WA government knocked backed an opportunity to help the almost 90,000 Western Australians who want a job but can’t find one when it rejected payroll tax relief in the May budget.”

But the CCI said there was optimism on the horizon for WA businesses, as more businesses in the real estate, mining, construction, manufacturing, healthcare and agriculture expect stronger economic conditions over the next 12 months than those expecting weaker conditions.

“The real estate industry has overtaken mining as leading confidence for the first time since CCI began publishing these industry results in 2017,” Mr Rodwell said.

“Almost three out of five (59 per cent) of real estate businesses expect stronger conditions over the next 12 months, up 25 per cent.

“It’s not doom and gloom for the mining industry though, with only 13 per cent of businesses expecting weaker conditions for the year ahead and half planning to increase their production over the next three months."

However, those in the retail and professional services industries are more likely than not to expect a worsening environment for their business.

Forty-one per cent of retailers are expecting conditions to worsen, up 13 per cent, with one out of three expecting to lay off staff over the next three months and only 5 per cent expecting to increase their capital expenditure.

 

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