Two-thirds of Australian SMEs say the rising Superannuation Guarantee would have a big impact on their business, outweighing new labour laws and ramped-up ATO collection activities at the top of the list of regulatory challenges they are facing.
This sentiment is shared in the newly-released 10th anniversary edition of ScotPac’s SME Growth Index Report, Australia’s longest-running sentiment check of small and medium businesses. In particular, SMEs with declining or stable growth (67 per cent) and those in a revenue growth phase (60 per cent) identified the rising superannuation guarantee impost as their leading regulatory pain point.
It is noted that from 2014 to 2021, Australian employers paid 9.5 per cent of each eligible employee’s earnings into their nominated super fund. However, the figure has since risen to 11 per cent, with an increase to 11.5 per cent scheduled for July 2024 and 12 per cent in July 2025.
The research also noted that 58 per cent of SMEs backed the relaxation of new and existing employment regulations that have increased their costs and administrative burden. In addition, 51 per cent of SMEs also seek company tax cuts and relief from ATO collection activities, with 62 per cent confirming they have been impacted by ATO debt in the past 18 months.
Meanwhile, 43 per cent of SMEs want regular Business & Income Activity Statement requirements simplified, led by larger SMEs with more employees (47 per cent). And 35 per cent are asking for new regulatory measures to address inflation and cost of living pressures to cushion the flow-on impacts for their businesses.
ScotPac CEO Jon Sutton said the insights confirmed that new and amended regulations were felt more acutely by SMEs.
“In the current economic climate, SMEs are particularly sensitive to any cashflow and administration impacts associated with regulatory change, which explains why the super guarantee is a particular pain point,” Sutton said. “Unlike large corporations, SMEs generally don’t have dedicated teams to interpret regulatory changes, implement compliance measures and redraft company budgets.
“With the vast majority of Australia’s 2.6 million businesses being SMEs with less than 20 employees, it is important that regulators are mindful of the impacts of new regulations work collaboratively with business on their introduction,” Sutton added.
