Source: Australian Tax Forum Journal Article
Published Date: 1 Sep 2014
When introducing the GST the Federal Government expressed that there would be the potential for business operators to gain a cash flow benefit from holding the GST revenue collected before remittance. However, it is not clear whether this has been realisable by all business sizes especially small businesses. Considering that small businesses are a major contributor of employment in the private sector and recognised as being capable of having a significant influence on future economic stability of the nation, it is important to determine how the GST affects small business cash flow and assess whether a benefit is in fact obtained.
This article reports a multiple case study of small (including micro) businesses with annual turnover of less than $10 million and a full time work force of less than 20 employees. The research explored whether small business participants perceived that there was a cash flow benefit from holding the GST liability for a period of time before it was due to be paid to the Australian Taxation Office. Findings suggest that the realisation of cash flow benefit for businesses trading with other businesses appears to be restricted, particularly as a result of terms of trade with other businesses.
More by Brett Freudenberg
Reasons behind SME advisor business structure recommendations - Journal 22 Apr 2024
Ordinary family dealings: how do we understand them? - Journal 15 Dec 2023
The business tax literacy of Australian small businesses - Journal 01 Apr 2022
Small business restructure roll-over: in need of its own restructure? - Journal 01 Apr 2022
Australia's 50% CGT discount: Policy oversight? - Journal 01 Mar 2020
Tax compliance in the new millennium: Understanding the variables - Journal 01 Mar 2020
What's in it for me? The potential for managerial benefits to improve tax compliance - Journal 01 Jul 2018
The Australian taxation system: The 2017 great debate - Journal 01 Mar 2018
The impact of tax on the prospects of achieving target retirement wealth in Australian default superannuation plans - Journal 01 Apr 2017
Tax literacy in Australia: Not knowing your deduction from your offset - Journal 01 Jul 2016
More by Melissa Belle Isle
More by Richard Copp
Sorry, this is subscriber only content.
To gain access to this material and much more - Subscribe Now.
(Note: Members can access Taxation in Australia journal articles without a Tax Knowledge Exchange subscription - please log in to access).
Already a Subscriber? Login now
Already a Subscriber? Login now
Details
The material is copyright. Apart any fair dealing for the purpose of private study, research criticism or review, as permitted under the copyright Act, no part may be reproduced by any process without written permission from The Tax Institute.
Unless expressly stated, opinions are not that of The Tax Institute, which accepts no responsibility for the accuracy of any of the information contained within it.
The Tax Institute
(ABN 45 008 392 372 (PRV14016))
("TTI")
The Tax Institute is a Recognised Tax Agent Association (RTAA) under the Tax Agent Services Regulations 2009.
All materials provided on this site are protected by copyright and are owned by or licensed to TTI.
Except as expressly permitted by TTI or the copyright owner, any person or company who uses this site must not use, reproduce, redistribute, retransmit, publish or otherwise transfer, or commercially exploit, the materials or any information, software or other content, in whole or in part, which is available through this site.
Tags