Small businesses will get an extra tax break with the Morrison government again extending the instant asset write-off to mid-2020.
The tax break will also be lifted immediately to cover assets worth up to $25,000, up from $20,000, Prime Minister Scott Morrison announced on Tuesday.
‘Businesses who go out and invest today, whether it’s a vehicle, whether it’s a piece of plant or equipment, all of it, up to $25,000 immediate write down,’ he told an audience in Brisbane.
‘We are so serious about small and family businesses and we have put our money where our mouth is.’
This is the third year-long extension to the measure, which was set to finish at the end of the current financial year.
It allows firms with a turnover of up to $10 million a year to instantly claim tax deductions on all equipment purchases worth less than $25,000.
Mr Morrison said it would mean more than three million eligible small and family businesses could keep $750 million of their own money and reinvest it in their business and support the jobs and wages of their 5.7 million employees.
The change needs legislation, which the government intends to pass once parliament returns in February.
The small business ombudsman has previously urged politicians to boost the tax break to $100,000, saying the $20,000 level was too low for capital-intensive businesses like farms.
Last March, Labor announced it would make the tax break permanent if elected.
‘The extension of the instant asset write-off announced today is welcome but goes nowhere near Labor’s Investment Guarantee, which is available for all investments over $20,000,’ shadow treasurer Chris Bowen said.