BUSINESSES and young unemployed people are among the big winners of the 2016 federal budget.
Federal Treasurer Scott Morrison delivered a budget he said would encourage business growth and the creation of new jobs.
“This is not a time to be splashing money around or increasing the tax burden on hard working Australians,” Mr Morrison said when delivering his first budget to parliament.
Among the big winners are small businesses, with the treasurer announcing reduced company tax rates of up to 27.5 per cent over the next 10 years.
Under the scheme:
- Businesses with a turnover up to $10 million will pay a reduced company tax rate of 27.5 per cent.
- Businesses with a turnover up to $100 million to gradually receive 27.5 per cent rate by 2020.
- All businesses to receive reduced company tax rate of 27.5 per cent by 2024 and 25 per cent by 2027.
- Unincorporated small businesses with a turnover less than $5 million get a tax discount of 8 per cent.
- Businesses with a turnover up to $10 million receive $20,000 instant asset write off, expiring in June 2017.
Mr Broad said 15,000 small and medium enterprises operating across the Wimmera and Mallee would benefit from the tax cuts.
“Small and medium enterprises provide the greatest employment and growth opportunities across this electorate. By providing a new tax rate of 27.5 per cent this will allow businesses to reinvest and explore new opportunities,” he said..
“The majority of businesses in the Mallee electorate are eligible for the increased threshold of $10 million meaning that they have access to the new tax rate. This is a great win for small and medium enterprises.
“Along with the tax cut, businesses within the new threshold will access an immediate deduction for assets up to $20,000 which will provide a further incentive for capital improvements. This is available until 30 June 2017.”
Mr Morrison also announced a package to help 100,000 vulnerable young people find work.
“It is worth trying new ways to get young people into jobs,” Mr Morrison said of the Youth Jobs Path.
“This is real work for the dole.”
Companies will be encouraged to take on interns and young people who take them up will receive an extra $200 a week on top of their welfare payments.
People with a disability will benefit from welfare budget cuts invested in a new National Disability Insurance Scheme savings fund.
Mr Broad said the $2-billion National Water Infrastructure Loan Facility would be a great boon to accelerate major water infrastructure development, including dams and pipelines, which would provide numerous investment opportunities across the Wimmera and Mallee.
He commended the government’s ongoing commitment to the Roads to Recovery Program, Bridges Renewal Program, Heavy Vehicle Safety and Productivity Program and the Black Spot Program.
Mr Broad said $298.2-million in funding over four years for the National Ice Action Strategy would assist communities in his electorate tackling the issues created by drug ice.
Mr Broad said the federal government would commit $50 million over four years to the Australian Grape and Wine Authority for the Export and Regional Wine Support Package to promote Australian wine and wine tourism.
“Taking on board industry concerns regarding the Wine Equalisation Tax Rebate, the federal government will reduce the rebate over the next two years and tighten the criteria to restrict bulk and unbranded wine from having access,” he said.
“From July 1, 2017, the rebate will drop from $500,000 to $350,000 and then again on July 1, 2018, it will reduce to $290,000. From data received, only one in 10 wine businesses have claimed over the $290,000 figure.
“The new criteria for those receiving the rebate means that a wine producer must own a winery, or have a long term lease over a winery and must sell packaged, bottled and branded wine in Australia. From my discussions with growers and industry this will be welcome news.”
Among the budget’s big losers were smokers.
The Commonwealth will increase tobacco excise and excise equivalent customs duties through four annual increases of 12.5 per cent per year from 2017 until 2020.
The government stands to make $4.7 billion from the increase.
Victoria also missed out on its slice of the pie,, with the state to get less than 10 per cent of national infrastructure funding averaged over four years.
Mr Morrison said families waiting to receive childcare subsidies funded by family tax benefit changes would have to wait until the middle of 2018; a year later than promised.
Statey hospitals will receive $2.9 billion in additional funding between 2017 and 2020 while aged care providers will lose more than $1 billion in funding for complex healthcare over four years.
University students will not have their fees deregulated after the policy was officially dumped but universities will still be hit with a 20 per cent funding cut, originally proposed as part of fee deregulation package.
Schools will get $1.2 billion in extra funding over three years from 2018 with disabled students to receive $118 million in funding for extra support.
There will be some changes to superannuation that will raise $2.9 billion over four years.
There will also be a $500,000 lifetime cap on non concessional super increases.
A low income tax offset will also be introduced as well as measures to help women build up their retirement incomes.
Mr Morrison confirmed there would be no change to negative gearing and that the government would act on bracket creep by raising the upper limit for the middle income tax bracket from $80,000 to $87,000
From July 1, the government will introduce a mandatory levy of $0.50 per tonne on all hay and straw prepared for export.
The mandatory levy replaces a voluntary levy and was proposed by the export fodder industry.
It is designed to address gaps in fodder industry research, development and extension funding.
The government will raise $172.9-million over four years by increasing passport fees. From January 1 next year, the cost of each new passport will increase by $20 for adults and $10 for children and seniors, and the fee for priority processing of passport applications will increase by $54.
The government will increase the Medicare levy low‑income thresholds for singles, families and seniors and pensioners from the 2015‑16 income year.
The increases take account of movements in the Consumer Price Index so that low income taxpayers generally continue to be exempted from paying the Medicare levy.
The threshold for singles will be increased to $21,335. For couples with no children, the threshold will be increased to $36,001 and the additional amount of threshold for each dependent child or student will be increased to $3306.
For single seniors and pensioners, the threshold will be increased to $33,738.
For senior and pensioner couples with no children, the threshold will be increased to $46,966 and the additional amount of threshold for each dependent child or student will be increased to $3306.
- with The Age