Budget2016

Tax cuts and incentives for small business

Backing the engine room of our economy and creating jobs.

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Creating sustainable growth and jobs, with a focus on small businesses

Our future depends on how we continue to support growth as we transition to a stronger, more diversified economy.

The Turnbull Government’s Ten Year Enterprise Tax Plan will help underpin Australia’s future economic success, attract new investment and create jobs.

This plan will support growth, higher wages and jobs by lowering the tax rate for companies over time to an internationally competitive level.

To grow and prosper, Australia must attract new investment to support economic growth, create jobs and improve living standards.

Our corporate tax rate is high by international standards and well above the average for OECD countries and those in the Asian region. If Australia is going to be competitive in the 21st century, we need a competitive tax system.

Small businesses contribute significantly to the Australian economy, employing over 3 million workers. To make it easier for businesses to invest, grow and hire more workers, the tax rate for companies will be lowered, starting with small business.

From 1 July 2016, businesses with annual turnover less than $10 million will have a company tax rate of 27.5 per cent. The company tax rate will be progressively lowered to 25 per cent by 2026-27 for all companies.

The Government will also extend a range of concessions already available to small businesses with turnover less than $2 million to all businesses with turnover less than $10 million from 1 July 2016.

The Government will make sure assistance is available for all small businesses by increasing the tax discount to 8 per cent for unincorporated businesses with annual turnover less than $5 million, capped at $1,000. This discount will be further increased in phases to reach 16 per cent by 2026-27.

“Our Ten Year Enterprise Tax Plan will boost new investment, create and support jobs and increase real wages, starting with tax cuts and incentives for small and medium-sized enterprises.”

Treasurer Scott Morrison

Learn more about our plan with regular email updates