Small businesses biggest Budget winners
Small businesses are amongst the biggest winners in the 2016 Australian Federal Government’s budget revealed last night in Canberra.
In Federal Treasurer Scott Morrison’s first budget, businesses with turnover of less than AUD $10 million annually will receive a one per cent tax rate drop from 1 July 2016 to 27.5 per cent.
The cut follows from the 2015 budget which saw businesses with AUD $2 million annual turnovers receive a 1.5 per cent tax cut pushing the rate down from 30 per cent 28.5 per cent.
By the year 2023-24, all businesses, no matter the size, will receive the 27.5 per cent tax cut. The rate is then projected to fall further to 25 per cent three years after that.
Food and Grocery Council welcomes budget
The Australian Food and Grocery Council’s (AFGC) Chief Executive Officer, Gary Dawson, has welcomed the above ten-year plan saying it will help stimulate business investment.
“In this budget the government has recognised the importance of confidence and certainty as a prerequisite for investment,” Dawson said.
“By laying out a ten year plan to progressively cut company tax the Budget lays the foundation for higher economic growth and a pathway back to a balanced budget,” he stated.
AFGC said the tax relief will have a positive flow in effects through the grocery and supply chain and welcomed the AUD $594 million set aside for creating a rail link between Brisbane and Melbourne.
“Also welcome is the commitment to major infrastructure projects, including the inland rail link between Melbourne and Brisbane, to cut transport costs and boost efficiency, with particular benefits for the food and grocery sector given its strong regional presence,” said Dawson.
Health Star system investment
The budget revealed a further AUD $5.3 million will be allocated to promoting the Federal Government’s Health Star Rating program.
The additional funding comes after the launch of the system entered its third phase on Sunday 17 April 2016 seeing a new wave of advertising and promotion for the scheme.
Tabacco tax increase
The Federal Government will be applying a tax increase of 12.5 each year, for the next four years on tobacco.
It is expected this will result in a packet of twenty cigarettes costing Australians AUD $40 by 2020.
The government will also be dedicating AUD $7.7 million to the Australian Border Force to help fight illegal importation of tobacco.
The Cancer Council of Australia welcomed the tax hike with Chief Executive Officer, Professor Sanchia Aranda saying it will save lives.
“The increase in tobacco tax alone will translate to tens of thousands of cancer deaths avoided, with trend data showing that the recurrent increases will lead to around 320, 000 smokers quitting and 40, 000 teenagers deterred from taking smoking up,” Professor Aranda said.
Agriculture and farming sector
A number of agriculture and farming representative have today expressed disappointment over the government’s decision to keep the backpacker tax introduced in the 2015 budget.
For more information on how the agriculture and farming will be impacted by the 2016 budget please read Australian Food News’ article here.