Monday, 8 June 2020
The South Australian Business Chamber has written to the Federal Government to further its push to relax Fringe Benefits Tax (FBT) for at least 12 months to provide an immediate boost for struggling hospitality businesses across South Australia.
Local business owners have echoed the South Australian Business Chamber’s call, saying the removal of the tax would provide an incentive to drive more customers through their doors, particularly during the daytime.
The South Australian Business Chamber CEO, Martin Haese, said he’d recently written to Federal Treasurer, Josh Frydenberg on the issue, arguing an FBT exemption on meal and entertainment expenses was one tool the Federal Government could use to help accelerate economic recovery from the COVID-19 pandemic.
“An exemption for at least 12-months on FBT would provide an immediate boost for the hospitality sector and stimulate demand for cafes, restaurants, function centres and convention operators,” said Mr Haese.
“Just because some of these businesses can now re-open under Stage 2, this doesn’t mean that they will be full, even after all restrictions are lifted later down the track.
“The South Australian Business Chamber was quick out of the blocks to advocate strongly on this issue to both the State and Federal Governments because we know it is something that can help create demand.
“An FBT exemption would also help drive more South Australians into our regions while borders are closed.”
The South Australian Business Chamber estimates that approximately $14 million in FBT revenues associated with meal and entertainment expenses is collected in South Australia each year.
“This is a relatively small price for the Federal Government to pay to protect the 61,000 jobs of South Australians employed in the hospitality industry,” Mr Haese said.
General Manager of Adelaide’s iconic La Trattoria restaurant, Billy Duff, said customer behaviour had changed during the pandemic with less people going out at night and that an FBT exemption could help reverse loss in trade while saving jobs.
“La Trattoria has been operating for 45 years and our reputation is that we were always open well into the night. However, with less people going out at night now and during the virus, we’ve had to cut staff hours,” he said.
“The FBT exemption would provide businesspeople with confidence and an incentive to get them into the restaurant over lunch to do business, which used to happen many years ago.
“A lot of restaurants and smaller businesses in the hospitality sector are going to struggle for some time yet unless their customers have the confidence to go out and spend.
Relaxing FBT for at least 12 months is a great way of supporting small businesses and keeping jobs.
“This will help many small businesses to stay afloat until they can start making money again.”
