The ACT is among the least business-friendly jurisdictions in the country, according to a new report.
The Canberra Business Chamber says the findings of the National Australia Bank-commissioned study show that it's more "difficult than it should be" for businesses in the national capital.
The opposition has seized on the study to again push its claim that the Barr government's high-taxing policies are forcing businesses out of Canberra.
But the ACT government has questioned one of the report's key conclusions, maintaining that its payroll tax settings, for instance, were "unashamedly" pro-small business.
The study, prepared by consulting firm AlphaBeta, scored each of the states and territories on 13 metrics under three broad categories - starting a business, running a business and growing a business.
The ACT sat behind only the Tasmania and the NT as the nation's "least favourable" jurisdictions in which to start a business, and behind only NT and South Australia when it came to growing a business.
In contrast, the ACT was found to be among the nation's better environment's for running a business, with the territory credited for having the highest proportion of managers with post-secondary qualifications.
The ACT was ranked the nation's worst in two categories: the amount paid on payroll tax for a firm of 50 people ($270,000) and the length of time (2.9 months) businesses were forced to wait for non-property related permits, such as liquor licenses.
Canberra Business Chamber chief executive Graham Catt said a thriving business sector was the key to the territory's COVID-19 recovery.
But he said investment would be stymied if the territory's laws and regulations made it hard for businesses to survive, much less thrive.
"This report clearly shows ... that it is far more difficult than it should be for owners to build and grow a successful small business," he said.
"With the election coming up in just three months, Canberra businesses are looking to the ACT government to turn that around.
"Business is ready to drive the ACT's economic recovery. By removing unnecessary obstacles, we have a real opportunity to support their growth and help ensure we have jobs for all Canberrans into the future."
An ACT government spokeswoman said it was focused on creating on the right environment for business to set up and run successfully.
The spokeswoman took umbrage with the study's assessment of the ACT's tax settings, saying it appeared to overlook the "significant benefits" of its payroll tax regime.
More than 90 per cent of businesses in the ACT don't pay any payroll tax because of the territory's $2 million threshold, which is the highest in the country.
"The ACT's payroll tax settings unashamedly favour small businesses and encourage small business creation and entrepreneurship," the spokeswoman said.
"It is only once firms have successfully established themselves and have grown to a substantial size that they start paying payroll tax. The combination of our payroll tax threshold and tax rate mean that small, local businesses pay less, while large national and multinational businesses pay more."
In the wake of the report's release, Opposition Leader Alistair Coe repeated his claim that the Barr government's high-taxing regime was driving Canberra businesses to set up across the border.
Pressed on how a Liberal government would ease the burden on businesses while still collecting enough revenue to pay for essential services, Mr Coe said he wanted to "grow the [tax revenue] pie" by encouraging more to open in the ACT.
"The ACT should be the best place in the country to do business, but of course in order to be the best place in the country we at least have to be the best place in the region," Mr Coe said.
"I want to see NSW businesses moving to the ACT. We want to grow the pie, and that starts by having a far more attractive tax regime."