Small business tax cuts kick in from July 1 2020

From July 1 2020, more than 17,000 small and family businesses in Bonner will be paying less tax as a result of legislated tax cuts passed by the Morrison Government.

As the 2020-2021 financial year begins, incorporated small and family businesses with a turnover of less than $50 million will see their company tax rate reduced from 27.5 per cent to 26 per cent.

Unincorporated businesses will also benefit as the rate of the small business income tax offset increases from 8 per cent to 13 per cent.

The changes mark the next stage of the Morrison Government’s accelerated small business tax cuts, legislated in October 2018, which brought forward tax relief for small and medium businesses by five years.

Minister for Employment, Skills, Small and Family Business Michaelia Cash said this was a big win for the small business sector.

“Small businesses are the backbone of our economy and with 3.5 million small businesses across the country, they are a vital part of our COVID-19 recovery,” Minister Cash said.

“As COVID-19 health restrictions ease and the economy re-opens, this tax relief will support Australian small and family businesses to bounce back stronger and get to the other side of this crisis.”

Federal Member for Bonner Ross Vasta MP said bringing forward these tax cuts would be a shot in the arm for hard working small and family businesses in Bonner.

“At a time when they need it most, these tax cuts will lead to more investment, increased employment opportunities for Australians and helping small business owners keep more of their money,” Mr Vasta said.

Treasurer Josh Frydenberg said these legislated tax cuts would provide further support to small business during the COVID-19 crisis.

“The Coalition Government has delivered extensive support for small and medium sized businesses during the COVID-19 crisis,” Minister Frydenberg said.

“We have extended the Instant Asset Write Off to $150,000 for another six months, are providing the Cash Flow Boost of up to $100,000 for employing small businesses, and are boosting access to capital through our COVID-19 SME Guarantee Scheme.

“This is in addition to the extensive income support JobKeeper, JobSeeker, and our Supporting Apprentices & Trainees wage subsidy are providing to support small businesses and sole traders across Australia.”

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There’s been some big news for Bonner recently! The winner of Queensland’s best fish and chip shop was one of our very own in Wynnum West. Fish and Chip Co was named overall winner of the 2018 Australian Fish and Chip Awards at the Queensland Seafood Industry Awards, or the Seafood Industry Oscars as they like to be called.

It was great to have a mobile office outside Fish and Chip Co the other day. I had a good chat with owner Demetri about their successes, and the challenges of running a business in the current environment.

I know a little something about these challenges. I ran a chain of Italian restaurants for a number of years. I understand how every little thing adds up. Decisions made at the Federal level mean the difference between surviving or having to lay off more staff for millions of small businesses across Australia.

That’s why I’m happy to say yet again this Coalition government has delivered for Aussie small businesses – small businesses like Fish and Chip Co that employ almost seven million Australians, 408,000 in Queensland.

Last month we passed legislation to extend the $20,000 instant asset write off another 12 months to 30th June 2019. Local small business owners continue to tell me how much this measure has helped them. Well over a thousand local businesses in Bonner have benefitted from the instant asset write off alone.

Then there are the tax cuts for small and medium businesses we delivered last week. Small and medium-sized businesses will now pay less tax five years earlier than planned. This is great news for over 15,000 local businesses in Bonner and over three million businesses across Australia.

By fast-tracking this tax relief for businesses in Bonner, we will make a more immediate difference to the individual businesses and the people who work for them. It means more money for local business owners to employ more staff. When business owners like Demetri can keep more of their own money, they have more to invest back into their business. That means more jobs, increased productivity and growth.

This legislation builds on the first stage of company tax relief we delivered in May last year. It stands in stark contrast to Labor’s plans for higher taxes for small businesses, along with higher taxes on income, savings, property, power and more—around $200 billion in higher taxes!

I look forward to seeing this government deliver more relief and support for small businesses like Fish and Chip Co in my electorate. Congratulations again to Fish and Chip Co for their well-deserved award! It’s always great to see outstanding small businesses in Bonner recognised for their high quality. I will just say their fish and chips are truly some of the best I’ve ever had!

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