The “engine room” misses out
Tuesday, 8 May 2007
Last Updated: Monday, 6 August 2007
By Amanda Gome
What a piecemeal budget! It’s a hotchpotch for small and medium business with no big ideas and grand vision for an innovation nation. And there are few measures that will assist business owners when they get up tomorrow. Unbelievably, while big business gets tax cuts, most SMEs will not.
Business owners didn’t even get the usual “engine room” speech, although Treasurer Peter Costello did say: “I pay tribute to the enterprise of Australia’s small business people.”
So what do business owners get? First up, the tax breaks worth $16 for the average wage earner will be welcome. And taxpayers, who will be able to click a box on the net and submit their annual tax return, will love this initiative, although your average suburban accountant will be pretty miffed at the loss of revenue and business.
Very small businesses will at last receive a little relief from GST with the threshold to register being raised from $50,000 to $75,000. The requirement for a tax invoice for purchases of $75 or less to claim a GST credit has also been removed.
Although there is no overnight relief from the skills shortage, there are big, long-term measures for education. The measures include the new tax-exempt payment of $1000 to top-up wages of first and second year apprentices aged under 30, in trades where skills are in short supply. The Government will also establish an endowment fund with a down payment of $5 billion from this year’s budget to pay for building and funding universities.
Infrastructure also gets a boost, with $22.3 billion over five years for road and rail – but it applies from 2009-10…
Good news for the tourism sector with $34.9 million over four years to extend the Australian Tourism Development Program. This provides competitive, merit-based grants to tourism projects and promotes development in regional and rural areas.
It also includes $10 million from 2007 to 2009 to provide additional drought assistance by funding tourism that will stimulate a region’s economic base.
There is also $59 million over four years to registered training organisations to partner with industry and local employers to develop and implement fast-track apprenticeships and $84 million over five years for a further three Australian technical colleges.
Business owners with children will also receive assistance, with the child care benefit up 10% from 2007 with a 30% rebate to be paid directly.
Oh, and at last: a research-shy government is putting some money into surveys with $6 million over four years to expand skills surveys to provide labor market data covering new industries and specific regional locations.
The measures coupled with the announcement last week of the $1.4 billion industry policy (see Howard's generous industry package) has been well received.
But why shouldn’t the “engine room” receive further assistance to create jobs, innovate and export? There are no cuts to capital gains tax, no plans to cut the top tax rate, zilch broadband initiatives such as movement on the national fibre-to-the-node broadband network and no further action on the intergenerational challenges (except for more money for seniors).