Peak employer groups call for payroll tax reform in WA

Western Australia’s peak business and industry groups have joined forces to call on the Cook Government to deliver payroll tax relief in the upcoming budget.

The Chamber of Commerce and Industry WA, the Association of Mining and Exploration Companies, the Australian Hotels Association WA, the Housing Industry Association WA, the Tourism Council of WA, the National Retail Association, the Franchise Council of Australia and the Australian Medical Association (WA) have come together to call for an overhaul of the tax, which punishes success and job creation.

Collectively, the groups represent thousands of employers across every sector in the WA economy, ranging from small and family businesses and new start-ups to large companies employing thousands of West Australians.

WA has the highest payroll tax burden in the country, with an average WA business paying more than an identical business in another state, despite our nation-leading economy.

The unfair payroll tax system is threatening WA’s reputation as a place to invest and do business.

Industry groups have proposed a sensible reform model aimed at offering much-needed relief to small and family businesses, while protecting the budget bottom line.

The model would raise the threshold for the tax kicking in from $1 million in payroll to $1.3 million.

Once payroll tax does kick in at $1.3 million, there would be a 15% rebate for businesses that tapers downward to reach zero for larger employing businesses.

Independent research commissioned by CCIWA in 2023 revealed the reform proposal would create $1.35 billion in economic benefit each year, including through interstate and overseas investment and reinvestment by businesses.

Just as families are being hit by rising costs, so too are businesses.

WA businesses across every industry have consistently highlighted rising costs as the number one barrier to growth over the past 12-18 months, surpassing skills shortages, weak demand and supply chain challenges.

The industry groups backing the campaign for payroll tax reform have co-signed a letter to WA Treasurer Rita Saffioti, urging her to consider tax relief for businesses as she prepares to hand down her first budget as Treasurer, and the last before the next State Election in March 2025.

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