8th May, 2023
Tomorrow night, Federal Treasurer Jim Chalmers will hand down the government’s 2023 Federal Budget.
This will be the second such Federal Budget announced since the Labor Party assumed power last year but is the first time they’ve been able to announce their funding packages in the usual May timeslot.
It’s expected that this will primarily be a Federal Budget targeted at cost of living relief and to deliver on the election promise of minimising disadvantage (“no Australian left behind”).
It will also likely be focused on areas with known bipartisan and voter support: sustainability reform, mitigating the effects of climate change, and improving the transparency and efficiency of existing programs.
As such, outcomes that support SMEs may not be directly targeted — they will likely benefit from measures that are announced as a sustainability, cost of living or wellbeing/women’s package.
An additional 20% deduction on any spend up to $100k that will go towards the energy transformation of your business.
This will apply to businesses with an annual aggregated turnover of less than $50m, this will also capture the mid-market.
Some small businesses, pensioners, and people on government payments will receive up to $500 to subsidise the cost of electricity.
But the size of the assistance will depend on where you live, with the package having to be negotiated with all state and territory governments, as it will be delivered as a co-investment.
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Treasurer Jim Chalmers has flagged a significant cost of living package will be included in the Federal Budget, with a number of measures being designed to ease the current pressures without driving up inflation.
So far, the confirmed announcements include the energy bill relief measure, cost of medicine, and boost in childcare subsidies (increasing the maximum rate to 90% for the first child).
PayDay Super: an obligation for employers of all sizes (including SMEs) to pay employees’ superannuation on the same day they pay wages and salary.
For SMEs, this will be an increase to their current obligation of having to pay quarterly. This won’t come into effect until 2026 — the long lead time is designed to ensure all businesses are ready for the change.
The 30% concessional tax rate has been announced on super balances over $3 million.
The government has announced plans to extend the dispensing timeframe from 30 to 60 days for medicines on the PBS. This will impact SME pharmacies and pharmacists.
An additional $720m in funding for the NDIS, including an overhaul of the NDIS scheme has also been announced.
Over 40% of NDIS providers are sole traders, so this will impact SMEs in the healthcare sector.
$10 billion has been announced for the Housing Australia Future Fund, which will commit to building 30,000 new rental properties over 5 years.
This will likely include a minimum of 1200 social and affordable houses in each state and territory. When implemented, this will also be a win for construction and manufacturing businesses.
The government is framing a range of issues as supporting women —including the change to the childcare subsidy.
The increase of JobSeeker payments for the over 55s is also being framed as predominantly an outcome for women, with the majority of over 55s facing disadvantage and employment/superannuation distress being women.
Change to the single parent payments: the cut-off for single parent payments is being lifted from 8 to 14.
Under this change single parents will be able to receive the additional support until the child turns 14. This change will come into effect from 20 September 2023.
Rent assistance, particularly for younger Australians. It will be interesting to see if this Federal Budget extends to SMEs/businesses with an annual aggregated turnover below a particular threshold.
Increase of the JobSeeker for age brackets other than the over 55s.
This Federal Budget is an opportunity for the government to reinforce its commitment to SMEs and give business owners the confidence to invest and grow.
But what else will be included for SMEs? Keep an eye on our social media feeds to find out.
Throughout Federal Budget Night, MYOB will be on the ground in Canberra, bringing you live news and updates as they come to hand.