After a tough couple of years, Josh Frydenberg has dropped some tax-break love on Australia’s small businesses in the form of targeted concessions to encourage investment in digital technology and on skills and training.
“From tonight, every hundred dollars these small businesses spend on digital technologies like cloud computing, eInvoicing, cybersecurity and web design will see them get a $120 tax deduction,” Mr Frydenberg said.
The Treasurer also said that “starting tonight, for every hundred dollars a small business spends on training their employees, they will get a $120 tax deduction”.
Under the Technology Investment Boost, small businesses with an aggregated annual turnover of less than $50 million will be able to deduct a bonus 20 per cent of the cost of business expenses and depreciating assets that support digital uptake, up to $100,000 worth of expenditure.
The Technology Investment Boost measures will apply to purchases made from 7.30pm tonight (Tuesday March 29) until 30 June next year.
The measure is expected to cost the government about $1 billion in forgone tax receipts, with some 3.6 million small businesses earning less that the $50 million threshold and eligible for the program.
Under the Skills and Training Boost, these small businesses – which employ about 7.8 million Australians – can also access the bonus 20 per cent deduction for the cost of external training courses delivered to their employees by providers registered in Australia.
The government says more skilled employees will drive productivity gains for small businesses, attract and retain staff in a labour tight market, and support future growth. This measure applies for training expenditure between tonight and 30 June 2024.
The Skills and Training measure will cost the Treasury coffers $550 million in forgone revenue.
Other budget measures aimed at local small businesses included $10 million to enhance and redesign the Payment Times Reporting Portal and Register, which makes it easier for small businesses to view the payment practices of Australia’s largest organisations.
The government has given the Australian Small Business and Family Enterprise Ombudsman to make it easer to access expert advice, and $5.6 million for a dedicated small business unit at the Fair Work Commission to help meet workplace obligations.
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