The Liberal National Government is backing small business with the introduction of legislation into Parliament yesterday that will boost and extend the instant asset write-off initiative.
The legislation will increase the instant asset write-off threshold from $20,000 to $25,000 and extend the initiative for another year from its existing June 2019 end-date to 30 June 2020.
This will enable more than three million small businesses across the country with an annual turnover of less than $10 million to access the new $25,000 instant asset write off from 29 January 2019, when we announced this boost.
The increase and extension of this initiative will improve cash flow for hard working Australian small business owners by bringing forward tax deductions, providing a boost to small business activity and encouraging more small businesses to reinvest in their operations and replace or upgrade their assets.
Our Government first introduced the $20,000 instant asset write-off in the 2015-16 Budget. In the first year alone, more than 300,000 small businesses bought assets taking advantage of this initiative according to the latest available data from the Australian Taxation Office – this equates to an average of around 800 businesses per day making a purchase with this initiative.
Our Government backs small business, because we understand that when businesses are able to keep more of their own money, they are able to invest back into the business, to create jobs, to boost their productivity and grow.
The increase and extension of the instant asset write-off builds on our Government’s record of backing small business and medium business and the around 5.7 million Australians they employ. Already we have delivered:
- Tax relief for incorporated small and medium businesses, with turnovers of less than $50 million per annum. These companies will move to a 25 per cent tax rate by 2021-22;
- An increase to the rate of the tax discount for unincorporated small businesses with turnover below $5 million; and
- An increase to the small business entity turnover threshold from $2 million to $10 million per annum, which has extended access to a range of tax concessions.
Backing small business is part of our plan for a stronger economy to help them reach their potential and create even more jobs.