The Federal Government’s recently announced National Innovation and Science Agenda reflects the City of Sydney’s focus on supporting technology startups and driving entrepreneurial growth.
As part of the $1.1 billion package of reforms, the Agenda offers incentives to invest in startups including tax breaks and significant changes to insolvency laws.
This means that it will now be easier for businesses to bounce back from a business failure, including changing the default period for personal bankruptcies from one year to three years.
The bankruptcy reforms, which are expected to be legislated in mid-2017 will also introduce a ‘safe harbour’ for directors from personal liability for insolvent trading if they appoint a professional restructuring adviser.
It is hoped that the changes will strike a better balance between encouraging entrepreneurship and protecting creditors and, over time, help reduce the stigma associated with business failure.
The Agenda also includes significant tax changes to help support startups offering a 20% tax offset if they put their money into new businesses.
If the money remains invested in the startup for more than three years, the investor will be exempt from capital gains tax on any profit they make.
The Government acknowledged that ‘entrepreneurs will fail several times before they make it’ and that ‘Australians needed to take a risk, leave behind the fear of failure and be more innovative and ambitious’.
In alignment with the national innovation agenda is The City of Sydney Draft Tech Startup Action Plan, which is currently being assessed and finalised following public comment earlier this year.
Over the next 10 years, it will help build a strong entrepreneurial culture and community, create skills and connect entrepreneurs.
It includes a huge amount of creative ideas from creating an entrepreneurship centre, to offering ‘how to code’ classes in local libraries and cutting through planning red tape to encourage more co-working spaces.
We know that 64% of Australia’s tech startups are located in the local government area of Sydney and this plan will help to build on that number and at the same time support entrepreneurs’ access to funding and markets.
In my role as deputy-chair of the Business Development and Economic Sub-Committee for the City of Sydney, I’m looking forward to seeing the outcomes of the draft plan and to help put in place the best possible environment for business growth and diversification.
I have been a small business owner for over 30 years and I know how challenging and daunting it is to self-fund a business and then put in place a vision for its future.
But it is also exciting and I for one am thrilled to see Federal, local and state governments on the same page voicing commitment and putting in substantial effort and investment in our entrepreneurs of the future.