As of tomorrow, Australia’s 3.5 million small and family businesses will be paying less tax as a result of legislated company tax cuts passed by the Morrison Government. By bringing forward tax relief, the Morrison Government is supporting small business as the engine room of our economy and the heart of local communities across Australia.
With the beginning of the 2020-2021 financial year, incorporated small and family businesses with a turnover of less than $50 million will see their company tax rate reduced from 27.5 per cent to 26 per cent.
Unincorporated businesses will also benefit with the increase of the small business income tax offset from eight per cent to 13 per cent.
This marks the next stage of the Morrison Government’s accelerated small business tax cuts, legislated in October 2018, which will see businesses with a turnover less than $50 million have their tax rate reduced to 25 per cent by 2021-2022 – five years earlier than originally planned.
As we face the biggest economic challenge since the Great Depression, supporting our small and family businesses has never been more important. This tax relief will mean small business owners will have more money to reinvest in their businesses, their staff and their communities.
These legislated tax cuts will provide further support to small business during COVID-19. The Morrison Government has delivered extensive support for small and medium sized businesses during the crisis. We have extended the Instant Asset Write Off to $150,000 for another six months, are providing the Cash Flow Boost of up to $100,000 for employing small businesses, and are boosting access to capital through our COVID-19 SME Guarantee Scheme.
The Morrison Liberal Government is committed to reducing the impact of tax and red tape on small and family businesses, boosting productivity and supporting the creation of jobs, because we know that when small businesses prosper and grow, we all benefit.
Senator the Hon Michaelia Cash
Minister for Employment, Skills, Small and Family Business
Senator for Western Australia