What the Election Results Mean for Small BusinessesTue, 28th May 2019
Following the recent re-election of the Coalition Government, we have detailed below some of the ways this will positively impact small business.
Small Business Tax Relief
We will see a reduction in the tax rate for businesses with a turnover less than $50 million, with the rate reducing from 30% to 27.5%, with plans to further reduce this to 25% over time. This is a significant change that will have a big impact on small businesses everywhere.
A tax discount of 8% (capped at $1,000) will also be available for unincorporated businesses turning over less than $5 million, with plans to increase this to 16% in time.
Instant Asset Write-Off
For assets up to $30,000 (formerly $20,000), the Instant Asset Write-off has been extended until 30 June 2020. For small businesses with a turnover under $50 million, this will help you to invest in machinery and equipment required for business growth.
Red Tape Relief
$300 million is being invested to help states and territories reduce red tape. Measures such as simplifying the Business Activity Statement, and doubling ASIC financial reporting thresholds, have already been introduced.
Access to Finance
To enhance the ability of small businesses to access funding, the Government is providing $100 million in funding to establish the Australian Business Growth Fund. Through partnerships with financial institutions, the aim is to grow the fund to $1 billion as it matures, thus providing equity funding to small and family businesses.
· Changes are being made to competition law, to prevent big businesses abusing market power.
· Through the new Australian Financial Complaints Authority, small businesses will be able to access free and binding dispute resolution.
· Legislation is being introduced to address illegal phoenixing activity, thus providing some protection for small businesses, who are often most affected when this happens.
Helping Cash Flow
As many businesses know only too well, cash flow problems can be seriously detrimental to your business.
Commencing 1 July 2019, the Government has committed to pay small businesses within 20 days (for contracts up to $1 million) and to develop a plan to introduce payment terms of five days when small businesses use e-invoicing.
The Export Market Development Grant scheme will receive a boost of $60 million to support small and medium sized Australian exporters. Australian exporters are likely to also benefit from the new Trans-Pacific Partnership established between 11 major economies in our region.
The Vocational Education and Training (VET) system is to be strengthened through the $525 million Delivering Skills for Today and Tomorrow package, to enable small businesses to take on more apprentices in areas of skills shortages.
Mental Health Support for Business Owners
A small business mental health portal has also been announced, specifically for business owners.
This is also a great step in recognising the link between running a business and the importance of looking after your mental health.
www.asbfeo.gov.au and www.liberal.org.au were referenced for this article.
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