Small Business is a winner as a result of the Australian government’s 2016 budget.
Small businesses will get a tax cut from July 1 this year, with the rate reduced to 27.5 per cent. The threshold for businesses eligible for this will rise from $2 million in annual turnover to $10 million. This will affect about 870,000 businesses and about 3.4 million workers.
The lower rate will be introduced to more and more businesses progressively until it is applied to all businesses by 2023-24. By 2026-27, the rate for all businesses will go down to 25 per cent, which the Government hopes will make Australians firms more competitive internationally. The measures build on a 1.5 per cent tax cut, announced last year, for businesses making less than $2 million.
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