2015 Federal Budget Overview
- Funding has been given to small businesses and infrastructure;
- This year the Government will roll out the biggest infrastructure programme in Australia’s history, with new road and freight corridors being built across the country.
- A series of plans and packages have been released to strengthen employment, retail trade and exports.
- Funding has been allocated to support farmers through drought.
- The Wine Equalisation Tax has not been addressed in the 2015 Budget, but the Government has announced that it will form part of the Government’s Tax White Paper in July.
Small Businesses and Employment
The Government has released a $5.5 billion Jobs and Small Business package as part of the 2015 Budget. The Jobs and Small Business package will provide tax relief for small businesses, as well as help with investment and employment.
96 per cent of Australian businesses are expected to be eligible for tax cuts through the new package.
- From July 1, small businesses with annual turnover of less than $2 million will have their tax rate lowered from 30 per cent to 28.5 per cent.
- Small businesses will also be eligible to claim an immediate tax deduction for all items purchased up to $20,000.
- Unincorporated businesses will receive an annual 5 per cent tax discount of up to $1,000 per year.
- The Government is expanding tax concessions for Employee Share Schemes to make it easier for small start-up companies.
- The Government is also facilitating new opportunities for crowd-source funding to make it easier for small investors to marry up with growing small businesses.
- The Government is abolishing Fringe Benefits Tax on all portable electronic devices used for work, such as mobile phones, laptops and tablets.
Farming and Agriculture
The Government is investing over $400 million to help Australian farmers, farm businesses and rural communities prepare for and manage drought.
- $70 million from the Budget will enable farmers to claim a three-year depreciation allowance for all capital expenditure on water facilities, fodder storage assets and fencing.
- All farmers will receive an immediate tax deduction to invest in water facilities;
- Farmers will also be able to fully deduct the cost of new fencing from their tax bill.
- $250 million will be given to continue the Drought Concessional Loan Scheme and the Drought Recovery Concessional Loan Scheme for an additional year.
- $25 million will be given between 2015-16 to programmes to manage pests and weeds in drought-affected areas.
- $35 million will be invested into shovel-ready, local infrastructure and employment projects.
- $20 million will fund the expansion of existing social and community support programmes for drought-affected families and communities.
- $1.8 million will fund additional rural financial counselors in drought-affected areas.
In addition to the above, the Government has announced that it will be holding further discussions with farmers and releasing more details about its plans to strengthen agricultural production in Australia over the next few weeks.
Foreign Affairs and Trade
While clarifications about WET retention still remain to be addressed, last night’s Budget announcement did hold significant promise for the promotion of Australian wine overseas. Specifically, the 2015 budget will commit $6 million to help boost a wide variety of Australian exports with the aim of capitalising on opportunities created by the trifecta of Free Trade Agreements (FTAs) with China, Japan and Korea.
- The Government will be rolling out a national FTA seminar series, which is designed to equip users with the information needed to leverage the opportunities created by the FTAs;
- For businesses that are unable to attend the seminars, further resources will become available soon to help provide information on how to expand their businesses and deliver product overseas.
- The Government is also developing an online dashboard-portal – including a comprehensive tariff finder – which will be a fast and efficient tool for businesses to use, to help make well-informed decisions about trading internationally.
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Wine TaxThe Wine Equalisation Tax, as speculated, was not mentioned in the release of the 2015 Budget last night. However, the Government has promised consideration as part of its White Paper in July. Issues expected to be addressed include eliminating the eligibility of New Zealand wineries for the WET rebate, along with a look at the qualifications of bulk and unbranded wines for the same rebate.
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