Changes to tax that will commence today for the new financial year have the potential to drive a large inflow of new investment into expanding Australian business ventures, yet there is still work needed to improve the broader innovation system and keep Australian businesses on Australian shores, according to a venture capital group.
The Australian Private Equity and Venture Capital Association Limited (AVCAL) chief executive, Yasser El-Ansary, said that tax changes will boost the start-up ecosystem and secure the long-term growth of new Australian businesses.
"These tax changes will dramatically boost the availability of capital in the early stage ecosystem, which is critically important to the nation's ability to support a growing pipeline of highly innovative new business ventures," he said.
"If you're an Australian entrepreneur, 1 July 2016 should be a red-letter day in your calendar."
AVCAL has warned that later-stage funding will still need attention too, so as to not to run the risk of Australian businesses seeking safer grounds overseas.
"Overseas funding often leads to promising Australian businesses relocating off-shore," El Ansary said.
"We have to take on this challenge and implement solutions that enable fast-growing innovative businesses which need to attract capital investment of $5 million or more, to access that funding here in Australia, rather than offshore."