Small Business Association of Australia CEO Expresses Disappointment Over Budget’s Neglect of SMEs

  • May 15th, 2024 at 10:25 am

Anne Nalder, the Founder /CEO of the Small Business Association of Australia, expressed a mixed sentiment towards the recent budget announcement. While acknowledging the relief it brings to households, she conveyed disappointment in its lack of substantial support for small businesses. Despite the treasurer’s acknowledgment of a projected rise in unemployment, the sector, which stands as the largest private employer in the country, received minimal attention, particularly during these challenging times.

Small business owners find themselves burdened with dual expenses, encompassing both personal household costs and escalating expenditures within their business.

Although the treasurer forecasts a budget surplus for 2024, there’s an ominous shift towards significant deficits in the ensuing years. The budget’s expansive allocations prompt speculation about its potential inflationary impact, with disparities between Treasury and Reserve Bank assessments regarding the trajectory of inflation.

Below is a summary of last night’s budget.

Objectives of the Budget:

  • Budget for the “here-and-now” amid “fraught and fragile global conditions,” like lingering inflation and higher interest rates.
  • Delivering a surplus of $9.3 billion for 2024-2025.

Key Benefits for the Small Business from the Budget:

  • The $20,000 instant asset write-off, which had been slated to end on June 30 this year, will be extended for another 12 months. Whilst this is welcome news, the instant asset write-off as announced in the 2023 budget has only just been passed.  (Update to the budget. As of Friday, 7 May 2024,  the instant asset write-off and the tax incentive for energy efficiency upgrades as announced in last years budget have not been passed by parliament. This means unless it is passed before 30 June 2024, small business owners will only be able to claim $1,000 for the instant asset write off).
  • One million small businesses will benefit from the $325 energy rebate, provided they meet the eligibility criteria.
  • Introduction of the Small Business Energy Incentive: This provides a 20% bonus tax deduction for small businesses with a turnover of less than $50 million on eligible depreciating assets up to $100,000 that support energy efficiency.
  • Support for Digital and Technological Adoption: $101.2 million over five years to help small businesses integrate artificial intelligence (AI) and quantum technologies to improve business processes and competitiveness.
  • Cybersecurity Support: $23.4 million allocated to the Cyber Wardens Program to help small businesses build resilience against cyber threats.

Tradies:

  • An additional 20,000 fee-free TAFE places and VET apprenticeships will be offered to address the chronic shortage of tradies in the construction sector.
  • The government will spend $90.6 million to increase the pipeline of skilled workers in the construction and housing industry.
  • Access to Government Contracts:

Measures to improve the ability for small to medium-sized enterprises (SMEs) to compete for government procurement opportunities. This includes enhancements to the AusTender platform for greater transparency and a new supplier portal.

  • Industry Growth Program:

$392.4 million committed to support small and medium-sized start-ups to commercialize their business ideas through grants and mentorship programs.

What Are the Disadvantages Small Businesses Are Receiving from the Budget?

  • The end of the temporary full expensing measure, which allowed businesses to deduct the full cost of eligible depreciable assets, could reduce immediate tax benefits for businesses making large capital investments.
  • Increased complexity in navigating new energy incentives and technology grants may require additional administrative resources.
  • PAYG and GST Uplift Rates: The uplift rates for PAYG and GST are set at 6%, which, while lower than the previous 12%, still represent an increase in obligations that could impact cash flow for some businesses.

FOR MEDIA ENQUIRIES –

Anne Nalder, Founder/CEO, Belinda Wilson, Small Business Association of Australia

MOB 0437 422 608 / 0411855747 Email info@smallbusinessassociation.com.au

Media release and review prepared by Anne Nalder Founder and CEO | Jay Jayasooriya SBAA International Think Tank Committee Member | Belinda Wilson Business Development and Marketing Executive, Small Business Association of Australia