The Coalition is pushing to expand the new-look instant asset write-off scheme, arguing it should cover eligible assets worth up to $30,000, up from $20,000 covered by the Labor government plan.
Appearing in the House of Representatives on Tuesday, Shadow Treasurer Angus Taylor said the Opposition is “not opposed in principle” to the measure, but has “design, effectiveness and utility of the small business incentive”.
Lifting the asset cut-off to its pre-pandemic level of $30,000 will allow eligible small businesses to claim accelerated depreciation on a greater variety of assets, Taylor said.
The Coalition also seeks to expand eligibility for the scheme by lifting the aggregated turnover cut-off to $50 million, up from the $10 million threshold set by the Labor policy.
Doing so will allow an extra 26,500 businesses to take advantage of the scheme, Taylor said.
The federal government projects its $20,000 version to cost $290 million over five years from 2023-2024.
The Coalition’s proposed expansion would result in a “modest additional cost over the forward estimates compared to Labor’s measure,” he added.
In a subsequent statement, Shadow Minister for Small and Family Business Sussan Ley said the proposed expansion “would give a much-needed shot in the arm to our manufacturers, farmers, and logistics businesses” struggling to maintain productivity.
The Labor government says its $20,000 threshold strikes an appropriate balance between budgetary moderation and continual support for small businesses, which would have been left with an accelerated depreciation asset limit of $1000 without a legislative update.
“We want to be able to continue to support [small businesses] in a way that didn’t add to inflation,” Small Business Minister Julie Collins told SmartCompany after Labor’s plan was revealed in the 2023-2024 federal budget.
Measures enacting the new instant asset write-off scheme are contained within a Treasury Laws Amendment bill, which is currently under consideration by the Senate Economics Legislation Committee.
The committee’s report is expected on November 24.
Senior Business Journalist
Focused on the small business sector, David’s work covers the political, regulatory, and economic issues facing Australian entrepreneurs. Prior to joining SmartCompany, he was a reporter for Business Insider Australia. You can follow him on LinkedIn.
