Budget 2018: Your five-minute cheat sheet for policies to watch
Tuesday, May 8, 2018/
Love it or hate it, tonight’s federal budget can affect how you do business.
Whether tonight’s policies have a direct impact on your company or simply set the tone and priorities for the year ahead, the national accounts shouldn’t be ignored, even if you’re not optimistic they will be stellar.
The lead up to this year’s budget was particularly quiet when it came to policies being leaked beforehand, with few policies passing the lips of frontbenchers. Even so, there are policies on the table that SME owners champion as effective and necessary, so it will be interesting to see the government’s approach to maintaining, or quietly retiring, these.
SmartCompany will be combing over the budget papers in the lockup this afternoon, so watch your inbox tonight for a special bulletin bringing you everything you need to know. For now, though, here’s what we’ll be looking for in Budget 2018:
The $20,000 instant asset write-off
This policy always gets all-round praise for its relevance and effectiveness, but in the past it has only been granted a few more months to live each time the government has reviewed it.
Small business groups all pretty much agree that the policy, which allows for claiming accelerated depreciation on business purchases, should be permanent. The 2017 budget saw the government breathe life into the policy until June 30 of this year, but everyone’s still mostly silent on whether it will continue into the new financial year.
R&D tax incentive changes
Startups and small businesses alike have benefited from research and development tax incentives, but the system is complicated and Treasurer Scott Morrison has indicated that changes could be on the horizon.
There have been rumblings that the government has been considering new limits and caps on how much a company can claim in one go, as well as across its entire lifespan.
Those in the startup space have warned that changing the game on this front could mean early stage companies move their research hubs offshore.
Income tax cuts
The government says it’s still committed to its company tax cut plan, but income tax cuts will also be on the table in this budget.
The ABC reports the cuts outlined tonight will start with low-income earners, with an extension of the “Low Income Tax Offset” meaning that lower-income earners may get a tax refund equivalent to $10.50 a week, while those on incomes of up to $90,000 could also stand to gain from some portion of the total offset amount.
Superannuation and women’s financial security
We won’t get the details for months, but there will be some cash earmarked tonight for a package relating to women’s financial security, particularly in retirement.
Minister for Women Kelly O’Dwyer has confirmed she will outline a full range of measures in September, but the government will move to improve women’s workforce participation, closing the superannuation gap between genders and improving the financial literacy of Australian women.
A number of pre-budget submissions from small business groups focused on the importance of funding and support for education and training, particularly in the TAFE or apprenticeships space.
The government outlined a policy last year that promised to provide the states with funding for in-demand apprenticeships, to the tune of $1.5 billion over the forward estimates. However, as the Australian Chamber of Commerce and Industry (ACCI) highlighted earlier this year, a year on, none of the states had actually signed an agreement to receive this money.
There has been very little news about education and training initiatives for apprentices and trainees in tonight’s budget, so any inclusion could be a welcome surprise.
We know that craft brewers have secured a win this week with a plan to change alcohol excise rules.
Then there’s the $24 billion expected to be spent on road and rail projects across the country, reports the ABC. There’s also an expectation a new policy suite for the aged care sector will feature tonight.
The likes of Elon Musk and Jeff Bezos are not the only ones partaking in a space race of sorts: $50 million in “seed funding” is also expected to go towards Australia’s “national space agency”.
And we still don’t know whether the government will make reference to its full corporate tax cut plan in the budget this year: it’s determined to get all businesses to that company tax rate of 25%, but not everyone agrees this is a good idea.
Stay tuned to your inboxes this evening for our full coverage of Budget 2018.