Treasurer likely to extend asset write-off for small businesses

The West Australian, 8 Mar 2018

Small busi­nesses are poised to get a boost in the Fed­eral Bud­get, with Trea­surer Scott Mor­ri­son ex­pected to ex­tend the Gov­ern­ment’s in­stant as­set write-off.

In a move that would also dent crit­ics’ ar­gu­ments against the coali­tion Gov­ern­ment’s pro­posed tax cuts for large com­pa­nies, it is un­der­stood the $20,000 write-off will be ex­tended and the amount could be in­creased.

The write-off, in­tro­duced in 2015 by then-trea­surer Joe Hockey, en­ables firms with a turnover of up to $10 mil­lion a year to in­stantly claim tax de­duc­tions on all equip­ment pur­chases worth less than $20,000.

The write-off, in­tro­duced in 2015 by then-trea­surer Joe Hockey, en­ables firms with a turnover of up to $10 mil­lion a year to in­stantly claim tax de­duc­tions on all equip­ment pur­chases worth less than $20,000.

When put in place, the pol­icy was fore­cast to cost the Bud­get $1.8 bil­lion over two years.

It was sup­posed to de­liver about $150 mil­lion to Fed­eral cof­fers in 2018-19.

Ex­tended in last year’s Bud­get, the write-off is due to fin­ish at the end of this fi­nan­cial year.

The Gov­ern­ment has been un­der pres­sure to ex­tend the write-off and there is strong sup­port in the small-busi­ness com­mu­nity to in­crease the $20,000 limit so that peo­ple such as farm­ers could use the de­duc­tion.

Yes­ter­day’s na­tional ac­counts showed non-min­ing in­vest­ment up 2.1 per cent in the quar­ter and 12.4 per cent over the past year, off­set­ting the fall in the min­ing sec­tor.

Yes­ter­day’s na­tional ac­counts showed non-min­ing in­vest­ment up 2.1 per cent in the quar­ter and 12.4 per cent over the past year, off­set­ting the fall in the min­ing sec­tor.

Pressed on whether the write­off should be made per­ma­nent, Mr Mor­ri­son said there was much to like about the pol­icy.

“I agree that the many in­cen­tives we’ve put in place for in­vest­ment in­clud­ing the in­stant as­set write-off have had the de­sired ef­fect,” he said.

“I like do­ing things that have the de­sired ef­fect.”

An ex­ten­sion and in­crease in the write-off would help off­set crit­i­cisms that the Gov­ern­ment has been too fo­cused on its over­all com­pany tax cuts that will de­liver the big­gest ben­e­fit to the na­tion’s largest firms.

An ex­ten­sion and in­crease in the write-off would help off­set crit­i­cisms that the Gov­ern­ment has been too fo­cused on its over­all com­pany tax cuts that will de­liver the big­gest ben­e­fit to the na­tion’s largest firms.