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The federal government is looking to increase the opportunities for Australian businesses to win public sector contracts by redefining the term ‘Australian business’.

A consultation paper exploring how to better define the nature of an Australian business for government procurement purposes has been issued by the government, and submissions close on October 25.

“Australian business is not commonly defined in Australian government legislation or policy and the Australian government does not have a standard definition of an Australian business that is applicable to all situations,” the paper says.

“Instead, there are a range of Australian business-related definitions that have been adopted for different purposes, including at the federal, and state and territory level.”

The consultation process will include the consideration of a range of factors such as the location of a business, where it is registered to pay tax, and the nationality of the business owners or shareholders in the quest to better define an Australian business.

Finance Minister Katy Gallagher said the consultation paper is a step towards better understanding how the government can better support Australian businesses.

“The Albanese government is committed to supporting our home-grown businesses to thrive and prosper,” Gallagher said.

“This is an important step which will give us better data on how procurement contracts are awarded and how Australian businesses can be better supported.

“We will always stand up for local businesses, which employ millions of Australians and contribute enormously to our economy.”

Industry and Science Minister Ed Husic said the exercise in developing a better definition of an Australian business will assist in targeting government funds to businesses that are genuinely Australian.

“Bringing clarity to how an Australian business is defined will mean when we say we are awarding money for local procurement, it will flow to the right firms,” Husic said.

“We want a definition that is robust enough to tell when a company is genuinely Australian.

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