TALK of extending the $20,000 instant asset write-off from both major political parties is a positive sign, according to the Institute of Public Accountants (IPA).
The Treasurer has signalled that the $20,000 instant asset write-off will be extended for small business along with a possible increase in the amount that can be claimed, while the Labor Party has indicated the write-off initiative could be extended to all businesses.
“The IPA has long advocated for the write-off initiative for small businesses and we are keen for it to continue as part of the tax regime,” said chief executive officer, Andrew Conway.
“We were relieved by the decision made in last year’s Federal Budget for it to continue up to 30 June 2018 as the reversion to a limit of $1,000 at that time would have been a huge disincentive for many small businesses.
“The increase in the accelerated depreciation write-off threshold to $20,000 has proven to be of great assistance to small business cash flow.
“This initiative brings forward the tax deduction that would have previously been deductible over a number of years.
“What should be kept in focus is the positive impact that this initiative has on the broader economy as it incentivises small businesses to reinvest in their future, making way for growth, employment and prosperity.
“We fully support a higher instant asset write-off becoming a permanent feature of our tax system going forward. The Henry Review into Australia’s tax system recommended that a higher threshold should apply.
“The need for this initiative to be set in stone, particularly for small businesses, is paramount as it brings an injection of economic growth, giving small businesses the confidence to buy new equipment, reinvest in their operations and grow,” said Mr Conway.
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