The Budget was delivered today, 2 April by Federal Treasurer Josh Frydenberg MP, one month early this year, ahead of Australians heading to the polls in May for the federal election.
Overall this was a good Budget, lowering taxes for small businesses and individuals to help stimulate growth, and expanding the size and accessibility of the write-offs to encourage investment. The only minus was increasing funds for regulators, as small business is already overregulated.
The key outcomes affecting small businesses and individuals:
- Small business tax cuts have been brought forward by five years, taking their tax rate from 27.5 per cent down to 25 per cent.
- The instant write-off has been extended to cover assets up to $30,000 for businesses with turnovers less than $50 million.
Individual tax cuts
- The first part of the plan is immediate, which includes a doubling of the tax offset announced in last year’s Budget.
- The change means people earning up to $126,000 will get $1,080 back at tax time.
- The coalition will also seek to flatten tax brackets by 2024, cutting the 32.5 per cent tax bracket to 30 per cent.
This is likely to be a vote winner for the coming election, but it did lack a ‘circuit-breaker’ like abolishing capital gains tax.
Overall the Budget is a good effort to help small business but lacked help on regulation.
It will, of course, require an election win to get past senate.
By Terry Murphy CPA
Last updated April 2019