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The Albanese government has announced the delivery of $1.5 billion in new tax incentives for small- to medium-sized businesses.
The Parliament passed legislation on Wednesday (21 June 2023) to introduce two new tax incentives, worth $1.5 billion, aimed at supporting small- to medium-sized enterprises (SMEs) to assist them in improving digital and tech capacity and training and upskilling employees.
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The Technology Investment Boost and the Skills and Training Boost will be backdated to 29 March 2022 in order for SMEs to receive full benefits, according to the federal government.
Until 30 June 2024, SMEs with an annual turnover of less than $50 million will be able to access a bonus 20 per cent deduction for eligible expenditure on external training of employees via providers registered in Australia.
In addition, SMEs will have access to a bonus 20 per cent deduction that aims to support the uptake of digital technologies until 30 June 2023.
According to the federal government, up to 3.8 million businesses that employ nearly 8 million workers will benefit from these new incentives.
The incentives are intended to help SMEs recoup some of the costs of the investments made in their employees and digital operations.
Treasurer Jim Chalmers said this investment would help boost productivity and scale up small businesses.
“We recognise how important the small-business community is to this country and to our national economy — that’s why we want to create more opportunities for them to grow and prosper,” the Treasurer stated.
“When small businesses invest in digital technologies and upskilling staff, it boosts their productivity and drives economic growth.
“That’s why we are making them law and backdating deductions so businesses are rewarded for the investments they’ve been making and can take advantage of this extra support.”
Minister for Small Business, Julie Collins, stated the incentives will set up Australia’s SMEs for more success after they’ve experienced “a difficult few years”.
Assistant Treasurer Stephen Jones said: “The government is investing in small businesses, so they can upskill employees, remain competitive in a rapidly changing technological landscape, and take advantage of new opportunities for growth.
“Millions of small businesses that have already invested in new technology this financial year will now be eligible to make deductions this tax time. It’s great news at a time where small businesses most need cash flow support.”
[RELATED: 48% of small businesses concerned about financial future: Xero]
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