iscover 
In the third consultation of its kind, Taylor and Liberal senator Susan Collins met with Joseph Daoud, founder of It’s Simple Finance, and Julian Fayad, founder of brokerage and loan-matching platform LoanOptions.ai.
The roundtable was also attended by business owners from a range of industries, including accounting, property, financial planning, e-commerce, and fashion.
The business owners said that the proposed capital gains tax (CGT) changes would discourage entrepreneurship, investment, and business growth.
The budget, the first tranche of which passed the House of Representatives on 5 June and has been referred to the Senate economics legislation committee, has prompted growing concern among sections of the small-business and start-up community.
The Senate economics legislation committee is currently scrutinising the bill under fast-tracked inquiry rules, with hearings taking place on Monday and Tuesday (15 and 16 June), though no broker groups were invited.
Labor is aiming to pass the bill through the upper house by 2 July, ahead of the winter recess.
Industry voices frustration
At the roundtable, Daoud said one of his key concerns was the lack of consultation with those affected by the changes.
“The fact that this Budget has been rushed through, no consultation, and they want it to pass by July 2 means that we are still not being listened to as small-business owners,” Daoud said.
“It is offensive because we are the people that built this country.”
Speaking to Broker Daily, Daoud said the proposed CGT changes had already begun influencing business decisions.
“In the short term, the proposed changes have already created confusion and hesitation among clients and peers,” Daoud said.
“Many people are reconsidering investments in start-ups or delaying decisions to hire because they’re unsure how their eventual exit or profit-sharing will be taxed.
“In the long term, my concern is that Australia could lose its reputation as a place where entrepreneurs are encouraged to innovate. If capital gains are treated punitively, we risk pushing talent and investment offshore and discouraging everyday Australians, from young ETF investors to employees with employee share schemes, from building wealth.”
Daoud has been among the most vocal critics of the proposal. Last month, he spent more than $17,000 on billboards at Canberra Airport protesting the planned tax changes.
In his post-roundtable address, Daoud also said that while parts of the budget had been framed around improving housing affordability, they did little to address housing supply.
“It was the current Government that brought this in place, and they label it as we want to give first home buyers a fair go. Where is this a fair go?” Daoud said.
“Nowhere in the budget have we seen housing supply be addressed. What we have seen is 35,000 less homes across the market. Nobody can tell if these are build-to-rent homes or if they’re homes that Australians can buy.”
He said that his concerns were not politically motivated and that a broad spectrum of businesses, reflected in the diversity of the roundtable, shared his grievances.
Attendants included:
- Daoud – It’s Simple Finance
- Fayad – Loanoptions.ai
- Emily Jeffery – Inka Maternity
- Sienna Jovcevski – Tweeny Skin
- Ray Regmi – Ryker Capital
- Davie Mach – Box Advisory
- Dylan Mullen – Cadian Sleep and Happy Skin Co
- Allen Fu – CheekyGlo
- Brendon Hill – hospitality consultant
- Samantha Campbell – SHYN
- Andrew Phanartzis – property consultant.
At the meeting, Taylor said the level of concern being expressed by business owners reflected broader frustrations within the sector.
“You can understand the depth of frustration and anger right now when this government simply doesn’t understand the role that small businesses play in this country in providing employment for a large proportion of Australians, in providing services to their customers, in providing opportunities for their suppliers, in creating opportunities for their own communities,” Taylor said.
Taylor also dismissed suggestions that targeted exemptions would resolve the issue.
“These taxes need an axe, not a carve-out. It is extraordinary that the Government would be running around saying to people, it’s alright, the legislation will allow for some kind of carve-out down the track in the future. Well, that’s not good enough,” Taylor said.
Pressure mounts ahead of Senate review
The federal budget’s proposed changes, particularly to CGT and negative gearing, have proved controversial across the broking industry.
In a survey of more than 200 brokers conducted by SME lender RedZed, half said their small-business clients felt either somewhat or very negative about the budget, while 36 per cent reported a somewhat or very positive reaction.
The Mortgage & Finance Association of Australia (MFAA) has also weighed in, backing the Council of Small Business Organisations Australia’s (COSBOA) Fair Go campaign and urging the government to reconsider parts of the package.
In its submission to the Senate inquiry, the MFAA warned the proposed CGT changes could affect long-term planning for broking businesses.
“The concern for small broking businesses is that CGT changes may reduce certainty around long-term business planning. Many mortgage brokers rely on the eventual sale of their business as a key component of their retirement planning, having prioritised investment in growing their business over accumulating other assets,” the MFAA said.
The proposed changes also prompted Fayad to launch a tongue-in-cheek social media campaign that helped spark the first of the roundtables.
Other industry figures, including Westbridge Funds Management chairman and Momentum Wealth managing director Damian Collins, have said that any changes should be introduced through a more gradual transition process.
[Related: HIA urges Senate to broaden housing tax exemptions]
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