Contrary to BCA claims, Victoria actually among strongest places for business investment according to actual data

Despite continual demonisation of Victoria’s economy and suggestion that the state is a bad place to invest, the most recent state economy figures show that the Victoria remains a very popular place for businesses.

Last week the Business Council of Australia released its annual “Regulation Rumble” report, stating that Victoria was the worst state to do business. The AFR placed great store in report, noting that “Victoria has again been ranked the worst jurisdiction in the country to do business, prompting warnings the Allan government’s high taxes and onerous red tape is stifling growth and driving investment from the state.”

The only problem is the reality says the complete opposite.

Today the Bureau of Statistics released the 2024-25 State Accounts, which are the state equivalents of the GDP figures. They contain a mass of data – including just how much business investment is happening in each state.

And while the BCA might argue Victoria is the worst place to do business, oddly actual businesses seem not to be listening. In 2024-25 Victoria had the second fastest growth of new business investment, behind only NSW.

 

In 2024-25, Victoria’s new business investment grew 0.4%. And it is not like it was coming off a bad year. Over the past 2 years Victoria again had the second strongest growth of business investment – this time behind Western Australia. And if we go back the past 3 years then Victoria has had the strongest growth in the entire county.

Now maybe that was affected by the pandemic lockdowns, but then Victoria also has had above average growth of investment since 2019-20 and the strongest growth over the past decade.

The reason the BCA report always finds Victoria as ‘the worst place to invest’ is because the report is not actually about investment. The BCA report is purely designed to put pressure on governments to cut regulations and reduce taxes in order to increase the profits of companies.

The report states “the report compares state and territory planning systems, payroll taxes, land taxes, licensing, and other regulation that may be holding back business activity across Australia.” The key word being “may”.

The BCA’s report also states that “as the second most populous state in the country, Victoria accounts for almost a quarter of the nation’s gross domestic product. So a poor performance for the state has an outsized impact on the nation’s global competitiveness.”

The BCA then should be very happy that over the past decade Victoria has consistently been one of the strongest places to invest – it has delivered an outsized impact on investment.

Business lobby-group reports might try to tell a tale about Victoria, but fortunately we have the reality of the ABS data to show what is actually happening.