The 2017 Budget explained – what does it mean for Canberra businesses?
24 May 2017
- Business Law
The 2017 Federal budget contained changes that will have an effect on Canberra businesses, including the removal of red tape for small business and significant changes to skilled migration. Caitlin Meers reviews the effects of the 2017 budget on businesses.
Small business continues to be supported by the 2017/2018 budget, with the continuation of the $20,000 instant asset write off provision. Businesses with less than $20 million turnover per annum can take advantage of this write off and immediately deduct eligible assets.
Via the National Partnership on Regulatory Reform, the budget will contribute $300 million to reduce red tape for small businesses. The funds will be granted to state and territory governments who assist in removing unnecessary regulation, including licensing and registration requirements.
Another $12.9 million has been allocated to the National Competition Council to assess the reduction proposals made, including the effectiveness of those proposals.
These funds are designed to have a positive impact on small businesses, for example, hospitality based businesses that are required to have a number of licences to operate their business.
Business in Australia
The Federal Government has flagged its intention to reduce the company tax rate to 25%, however these changes have not been implemented in the 2017/2018 budget.
Business should also be aware of significant changes being made to the skilled visas available in Australia. The temporary subclass 457 visas have been restructured to be replaced with two new types of visas over the next 10 months.
From March 2018, businesses that employ foreign workers, on certain visas, will be required to pay the government a training levy. Businesses with employee(s) on a Temporary Skill Shortage Visa, and with less than $10 million turnover per annum, will have to pay a levy of $1,200 per visa (per employee) per year. Business with more than $10 million annual turnover will have to pay a levy of $1,800.
In addition, small business employers will also have to pay a one-off fee of $3,000 for each employee they are sponsoring under the Employer Nomination Scheme (subclass 186) or on a permanent Regional Sponsored Migration Scheme (subclass 187). Business with more than $10 million annual turnover will have to pay a one off fee of $5,000.
These fees will increase the costs imposed on businesses who hire foreign workers, including those that operate in industries where skill shortages exist. However, it is intended that these fees replace the existing training benchmarks.
The Canberra Community
As noted by many commentators, the ACT has been largely ignored in the 2017 budget with $500,000 announced for the Monaro Highway, Canberra Avenue to Hume Highway Planning stage and $1 million announced for the Pialligo Avenue Duplication planning stage.
No further infrastructure or projects have been funded by the federal government in the 2017/2018 budget.
As the nation’s capital and a hub for tourism, the ACT may be affected by the reduced budget allocated to Tourism Australia, down to $129 million from $143 million in 2016/2017. As the Canberra Airport continues its steady growth into the international travel sector, the ACT economy may have to rely on alternative advertising measures to continue to bring tourism to the Canberra region.
Can Snedden Hall & Gallop help?
Our Business Law team offers a wide range of services to support all businesses, including employment and leasing assistance, skilled visas and immigration, purchase and sale of business and dispute resolution. If you require any assistance, please contact us by phone on (02) 6285 8000 or by email.