The Franchise Council of Australia welcomes initiatives announced in the 2016 Federal Budget to stimulate economic prosperity in the small business sector.
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The ACT will need to continue to go it alone in its economic recovery as Scott Morrison’s cautious pre-election budget offered little local cheer and even less political risk.
“For more than 800,000 SMEs, these measures translate into two tax cuts in as many years, while a further 60,000 will see an instant tax reduction of 2.5%”, she says.
The budget is projected to return to balance by 2021.
New spending has been more than offset.
Another $1.6 billion in spending has been set aside between 2016-17 and 2018-19 while a cut of $2 billion as been scheduled for 2019-20.
The budget papers also forecast lower inflation over four years, which is one of the reasons that the RBA cut rates.
“This is not the time to be splashing money around or increasing the tax burden on our economy or on hardworking Australians and their families”.
‘Everyone has to pay their fair share of tax, especially large corporates and multinationals, on what they earn here in Australia, ‘ Treasurer Scott Morrison said.
These include lowering company taxes over 10 years from 30% to 25% and an immediate one-percentage point cut to 27.5% for small businesses. This was previously announced last year, with businesses with a turnover of less than $2 million per annum getting a 1.5 percentage point reduction in tax rate.
The proposed Diverted Profits Tax (DPT) will apply to companies with global revenue of more than AU$1 billion and Australian revenue of more than AU$25 million.
The Australian Government has also announced a new Tax Avoidance Taskforce to crackdown multinational tax avoidance and security revenue.
As anticipated, the budget promises to prevent average full-time wage earners from moving into the second highest tax bracket.
There will also be a tax cut for workers earning more than $80,000.
When you consider we are in a region with some of the fastest growing economies in the world, the ultimate target is not aggressive enough and the timeframe is much too long.
Turnbull said on Wednesday high-income earners deserved to have the deficit levy lifted because they were being hit by the government’s changes to superannuation concessions. The only reasonable part of this measure is that the $500,000 limit will increase in line with the annual increase in average weekly ordinary times earnings.
The new accounting team will cost an extra $679 million over four years, but the government insists it will be able to dig up $3.7 billion in lost revenue over the same period.
The government expects this will affect approximately 870,000 businesses.
The job seekers will get $200 a fortnight while interns, on top of their ordinary income support.
Mr Morrison might well be wishing he had 24 hours up his sleeve.
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Welfare recipients will face greater scrutiny before receiving payments.
