Australia is the second easiest place in the world to start up a business, according to a major international study.
Rankings compiled by the World Bank and the International Finance Corporation place Australia behind only New Zealand in terms of the ease of starting up.
The report judged that the one-day turnaround and $400 charge to ASIC to register a company, followed by the one-day process of applying for an ABN was more straightforward than elsewhere, such as the six-day timeframe in the US and the eight-day process in the UK.
Australia also fares well in the overall ‘ease of doing business’ ranking, sitting in 10th place, while, perhaps surprisingly, the country is judged to be the sixth easiest place in the world to obtain business credit.
However, despite the overall rosy outlook, Australia is marked poorly in a number of individual areas. The country is placed 63rd in the world for dealing with construction permits, down one place from last year, while the trading across borders ranking is 29, down from 28th position last year.
The biggest drop is in the area of tax, with Australia placed 48th in the world, down from its ranking of 44 last year.
Senator Nick Sherry, the federal small business minister, says that the report shows that Australia is “a great place” to start and run a business.
“Of course, there is always more to be done and the Government’s ongoing reform agenda is taking the lead to making life even easier for SMEs.
“The Gillard Government has an ambitious reform agenda, including tax cuts for business and cutting red tape to make it easier to do business.”
“Our proposed reduction to the corporate tax rate shows the high priority this Government gives to small businesses – incorporated small businesses will receive the cut a year earlier than larger companies.”
“During the global financial crisis, we provided direct assistance to small businesses through initiatives such as the Small Business Tax Break, while tax concessions also allowed small businesses to defer or delay payments.”
However, Bruce Billson, the shadow small business minister, claims that Sherry has “cherry picked” the best parts of the report and ignored the negative aspects.
“There are still considerable challenges faced by small businesses and there is plenty of work to be done,” he says. “I just about fell out of my chair when I saw (that Australia was sixth in the ease of credit ranking). Getting credit is a real, ongoing concern for businesses.”
“The Coalition’s nine-point plan contains very specific measures that will help small businesses. To say that there is only so much the Government can do (as Sherry has previously indicated) underlines the indifference minister Sherry has towards the plight of small businesses.”