BUDGET: AN ELECTION SWEETENER FOR SMALL BUSINESS
There is more good news for small business in tonight’s Federal Budget, says the Institute of Public Accountants (IPA).
“Last year’s Budget delivered some steps in the right direction with tax cuts and asset write-offs and this year, the Government has kept to their word when it comes to supporting the most critical sector of our economy,” said IPA chief executive, Andrew Conway.
“A further reduction in the income tax rate for small business (from 28.5 per cent to 27.5 per cent for 2016-17) combined with an increase in the eligibility turnover from $2 million to $10 million for incorporated businesses will be well received by an additional 90,000 small businesses.
“They will also be eligible for other small business tax concessions (including the $20,000 instant asset write-off).
“Unincorporated small businesses won't completely miss out. The benefits will be extended by increasing the eligibility turnover threshold from $2 million to $5 million pa, and increasing the discount to 8 per cent (and 16 per cent over the next decade). Disappointingly, the $1,000 cap pa remains.
“Addressing the bracket creep issue is also a positive with changes for those earning between $80,001 and $180,000 being extended to $87,000; this is good news for both individuals and unincorporated small business owners.
“We acknowledge that the Government is relying on the "growth dividend" from these measures to reduce the budget deficit. Until then, we are walking on a tight rope," said Mr Conway.