2024 Federal Budget Update
Understand the key takeaways from the May 2024 Federal Budget and how it will affect your business.
What is the budget?
The Australian Federal Budget is prepared by the Treasurer and presented to Parliament. The budget outlines the proposed revenue and spending of the Australian Government for the upcoming financial year. The Federal Budget is also a political statement of the government’s intentions and priorities for the upcoming financial year and beyond.
The majority of government revenue comes from income & company tax, sales tax (GST), and interest and dividends. The government needs this revenue to pay for the public goods and services it provides, including, education, health, defence, infrastructure, welfare, and much more.
The small business budget wish list
What did the May 2024 budget deliver?
The 2024 Federal Budget was largely focused on the cost of living and inflation mitigation measures. While not a heavily SME focused Budget, there was still plenty in there for Australian small businesses. Here are the key takeaways from the latest Budget announcement that may affect you and your business.
Instant asset write-off extension
In a move that was sought by at least 51% of small businesses, the instant asset write-off has been extended to 2025.
If your small business has an aggregated turnover under $10 million, you can immediately deduct the full cost of individual eligible expenses. Each expense can cost up to $20,000. This will mean that SMEs can write off several pieces of new business equipment immediately.
Energy rebates
Two separate energy rebate measures were introduced this year, with one focused on households, and another specifically for small businesses. These rebates are intended to alleviate inflation and the cost of living.
The individual energy rebates will mean every household will receive $300 off their energy bills, while eligible small businesses will receive a $325 energy bill discount over the 2024-25 financial year.
Personal income tax cuts
With 70% of surveyed small business owners seeking cuts to personal income taxes, this measure should be relatively popular.Â
The previously announced, and revised, stage three tax cuts are now in play. This means that from 1 July 2024, all 13.6 million Australian taxpayers will now receive a tax cut, with new rules and tax bracket changes covering more earners across the income spectrum.
Housing and rental relief
When we surveyed Australian small businesses, we found that 49% wanted better housing affordability. While there’s no silver bullet, there were several inclusions in the Budget to address this.
There will be new investment in building houses, increased rental assistance, more support for vulnerable Australians, and further investment in existing housing schemes and initiatives.
Future Made in Australia
The ‘Future Made in Australia’ initiative is a local and sustainable manufacturing push that will mostly involve the larger businesses in Australia, with flow-on effects to smaller businesses.
The government will invest around $23 billion in a slew of measures intended to boost Aussie manufacturing, reach net zero more swiftly, support green energy, and capitalise on critical minerals. This is combined with more support for apprenticeships and TAFE positions to fill skill shortages.
Inflation and cost of living mitigation
We saw several individual measures announced that work to combat inflation and alleviate the rising cost of living. In fact, the government specifically framed the latest Budget in these terms.
These measures include power rebates, housing and rental assistance, income tax cuts, cheaper medicine, student loan changes, and the examination of supermarket pricing and competition.
The latest resources to help you manage the budget
The 2024 Federal Budget recap for small businesses
Read more >
Getting your head around the constantly shifting instant asset tax write off
Read more >
What are Australian businesses looking for in the upcoming 2024 Federal Budget?
Read more >
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