Small business has been investing "with gusto" as it takes up the tax breaks offered in the 2015 budget.
The Australian Chamber and Commerce and Industry quarterly small business survey shows plant and equipment investment at its highest level in more than six years.
It says the result is down to the $20,000 instant asset write-off offered in 2015.
"Small businesses have taken up with gusto the measures announced in last year's budget," chamber chief James Pearson told reporters in Canberra on Monday.
It also showed the decision in the May 3 budget to extend the instant asset write-off to businesses with a turnover of up to $10 million from $2 million was the right one.
The government has also promised incremental cuts in the corporate tax rate to 25 per cent over the next decade for all businesses, a plan rejected by the Labor opposition.
But Mr Pearson has urged Labor to demonstrate bipartisan backing for business.
"A target of 25 per cent is what the country needs right now to stimulate investment to encourage growth and to generate more jobs," he said.
Most gauges in the survey improved in the March quarter result, while wage growth and labour costs moderated.
The survey's small business conditions index rose to 48.6 points from 45.8 in the December quarter, but remained below the crucial 50-point level that separates growth from contraction.
Mr Pearson said that showed the economy remains in transition from a mining boom to broader-based growth.
"This is why, as we head towards an election, all parties must consider the effect of their policies on business confidence," he said.
