Barnaby Joyce

Lower taxes delivered for New England small businesses

06 Apr 2017

 

 

Deputy Prime Minister and Member for New England, Barnaby Joyce, said that Australia’s 3.1 million small businesses – including the 19,915 medium and small businesses in the New England Electorate – will pay less tax under the Turnbull-Joyce Government’s Ten Year Enterprise Tax Plan passed in Parliament last week.

 

“Reducing the tax burden on small business gives small business owners in the New England Electorate the chance to grow, to hire more locals and pay them more,” Mr Joyce said.

 

“This will benefit the New England community, because the Government understands that when taxes are lower for small businesses, that money is reinvested in expanding a business, hiring more people, giving them more hours of work and paying them more - not put in a business’ back pocket.”

 

Mr Joyce said almost 40 per cent of small businesses in the New England Electorate were related to agriculture and the Coalition’s commitment to small business would further strengthen the agricultural sector locally.

“Agriculture is the most important contributor to rural and regional economies, particularly the New England, and these measures will see that contribution grow significantly for the benefit of rural people,” Mr Joyce said.

 

“Under our plan, New England businesses with turnovers up to $10 million are now defined as small businesses and will pay a lower company tax rate of 27.5 per cent from this financial year, before eventually falling to 25 per cent.

 

Mr Joyce said the 27.5 per cent company tax rate delivers the lowest tax rate for small business in 50 years.

 

Cutting the company tax rate and broadening the definition of small business also means more local small businesses can now access the instant asset write-off program.

 

“The Government’s Enterprise Tax Plan means more small businesses can instantly write-off new equipment worth up to $20,000 and claim it back straight away,” Mr Joyce said.

 

“Anything from a stainless steel servery to photocopiers, computers or coffee machines can now be bought and claimed back against tax, freeing up cash flow for local small businesses, thanks to our changes.”

“We believe in practical support for small business and have delivered in spades again.”

 

Small Business Minister Michael McCormack said the small business tax cut, simpler paperwork and greater support for small business are designed to take the pressure off small business, to help the sector grow and create local jobs.

 

“Cutting small business taxes has always been top of the Government’s agenda and I am delighted we have delivered the lowest tax rate since 1967,” Mr McCormack said.

 

“Small business already makes up more than 97 per cent of businesses in Australia and employs more than 5.5 million Australians but we want to see this number grow.

 

“The Government understands delivering lower company taxes means more Australians can start a small business, have a go and create jobs.”

 

LIST OF MEASURES: Company Tax Rates (%) passed by the Government in the Senate (31/03/17)

 

Size

2016-17

2017-18

2018-19

2019-24

2024-2025

2025-26

2026-2027

Up to $10m

27.5

27.5

27.5

27.5

27

26

25

Up to $25m

30

27.5

27.5

27.5

27

26

25

Up to $50m

30

30

27.5

27.5

27

26

25

 

 

 

Measures to Help Small Businesses

Measure

Before - Business Turnover

After - Business Turnover*

Increasing the tax discount for unincorporated small business

Unincorporated Businesses with turnover up to $2 million; discount of 5% with a cap of $1,000

Businesses with turnover up to $5 million; discount of 8% this year, increasing in stages to 16% by 2026, with a cap of $1,000

Instant Asset Write-off on asset purchases up to $20,000 until 30 June 2017 and on-going simplified depreciation rules

Write-off of $1,000 up to $2 million (prior to 2015-16)

Up to $10 million  - $20,000 write-off expires on 30 June 2017

simplified trading stock rules, with the option to avoid end of year stocktake if the value of their stock has changed by less than $5,000;

Up to $2 million

Up to $10 million

a simplified method of paying

PAYG instalments calculated by the ATO, removing the risk of under or over estimating PAYG instalments and the resulting penalties that may be applied

Up to $2 million

Up to $10 million

an option to account for GST on a cash basis and pay GST instalments as calculated by the ATO; other tax concessions currently available to small businesses, such as fringe benefits tax (FBT) exemptions (from 1 April 2017 to align with the FBT year)

Up to $2 million

Up to $10 million

other tax concessions currently available to small businesses, such as fringe benefits tax (FBT) exemptions (from 1 April 2017 to align with the FBT year);

Up to $2 million

Up to $10 million

a trial of simpler business activity statements (BAS), reducing GST compliance costs, with a full roll-out from 1 July 2017

Up to $2 million

Up to $10 million

*These threshold changes will not affect eligibility for the small business capital gains tax concessions, which will remain available for businesses with annual turnover of less than $2 million or that satisfy the maximum net asset value test.

 

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