Business leaders call for 25% red tape reduction amid rising costs

Nearly 30 groups representing small, medium and large businesses, and universities, that employ millions of Australians, are calling on all governments to cut regulatory costs by 25 per cent to help consumers and businesses amid surging costs caused by the Middle East war.  

The Alliance of Industry Associations, which represents every part of the Australian economy, is calling on all levels of government to reduce red tape costs now and commit to a 25 per cent reduction in unnecessary regulation by 2030.  

A recent AICD Mandala report shows federal regulatory compliance now costs the Australian economy around $160 billion a year, almost 6 per cent of GDP and more than the Federal Government spends on Medicare and school education combined.  

The Alliance warns that duplication and fragmentation across governments are driving up costs for households and businesses.  

The call is outlined in the Alliance’s 2026–27 Pre-Budget Submission, released today, which highlights how overlapping and inconsistent regulation across federal, state and local governments is adding unnecessary complexity, delaying projects and increasing costs across the economy.  

Council of Small Business Organisations Australia, CEO Skye Cappuccio said, “For small businesses, red tape often means hours each week spent navigating compliance complexity instead of running their business. That’s time taken away from customers, staff and growth. Reducing duplication would ease costs and support stronger productivity growth across the economy.”  

National Farmers’ Federation, CEO Mike Guerin said, “Australian agriculture is on track to contribute more than $100 billion to the economy this year and supports over 250,000 jobs, despite the significant global headwinds thrown its way. Imagine what could be achieved with smarter policy settings and less red tape.  

 “Cutting duplication would allow farmers to be more nimble in responding to global shocks, spending less time in the office and more out in the paddock, keeping Australian agriculture competitive on the global stage.”  

Business Council of Australia, Chief Executive Bran Black said, “In Victoria, a café owner needs 37 separate licences and approvals before they can pour the first coffee, while a tradie on the Gold Coast needs to pay hundreds of dollars in permits just to fix a tap over the NSW border.

“That kind of red tape adds cost, slows things down and makes it harder to keep goods moving and shelves stocked. With global volatility already pushing up prices, cutting that duplication would help bring down costs for Australian households and businesses.”  

This cost is ultimately borne by businesses, workers and Australian families at the checkout.  

At a time when global pressures are already pushing up costs, unnecessary duplication in our own system is adding to the burden.  

Good regulation protects Australians, but when it becomes complex, duplicative and costly, it drives up prices and slows growth.  

The Alliance is calling on governments to commit to a 25 per cent reduction in regulatory burden by 2030, starting with immediate steps to reduce costs, undertake an economy-wide regulatory stocktake, and improve coordination across jurisdictions to remove duplication and inconsistency.  

The United Kingdom has implemented reforms to reduce regulatory costs and complexity, while the European Union has adopted a 25 per cent red tape reduction target, rising to 35 per cent for small businesses, as part of broader pro-growth reform agendas.  

The Alliance of Industry Associations consists of groups representing Australia’s small, medium and large businesses, universities, farmers, retailers and the investment community. The Alliance works collaboratively to support practical reforms that improve productivity and living standards for all Australians.