Does the new Aussie budget have any impact on your startup?
There weren't many expectations heading into the Budget this year for startups, and it turns out rightly so. In a Budget where the Treasurer decided to pretty liberally splash the cash around, the technology sector remained pretty dry. Perhaps the most notable measure relevant to startups is a $60 million increase to the Export Market Development Grant. The EMDG is a broad program designed to help SMEs market and sell overseas. It can support spending on advertising, international travel, conferences, sales trips and other expenditure used to promote your products to an overseas market. The EMDG as startup support Since startups are naturally focused on establishing export markets with their global approach, this is of particular value to high-growth businesses. The EMDG has gone a little under the radar in startup circles, but some of the leading Australian tech founders we've talked to say it was really valuable for their business. As part of a series of interviews StartupAUS conducted with scale-up founders, we asked about their experience with the EMDG: Didier Elzinga of Culture Amp said, 'What the EMDG does well is it says go overseas and try to sell what you're doing and we'll make it simple and easy and we'll encourage you to do it.' He used the EMDG to make sales in the US and says part of its value is as an incentive to generate activity. 'I think it's the most successful yet unheralded program that encourages the right behaviour. It gets people into entrepreneurial activity and its pitched at the right level.' Jonathan Barouch at Localmeasure added, 'We do a lot of overseas conferences so [the EMDG has] been really helpful to offset the costs of going overseas.' To find out more about the EMDG, head to Austrade's EMDG guide.
Other Budget measures Small business tax cuts may be a welcome sight for those businesses that are profitable, but in an arena where traction and growth is prioritised over revenue, most tax cuts for small businesses will not have a significant impact on the startup sector. Some measures in skill development, including a $3.4 million commitment to support women in STEM careers, should have a long-term positive impact on the sector. But one measure that is conspicuous by its absence is any reference to the Research and Development Tax Incentive (R&DTI). Last year, the government responded to a 2016 R&D Tax Incentive review and announced a crackdown on overclaiming of the scheme. One year later, the response to the review has been put on hold, yet startups continue to be hammered by audits while the status of software under the scheme is in limbo. We all know how valuable the R&DTI is to the startup sector, and every day that goes by with more businesses being targeted for audits is a blow to the strong growth of the sector. It's threatening to pull the rug out from under the sector - but nothing was said about it tonight.
The information in this article came from a post from StartupAUS.