27th Nov 2023, 12:39 PM – Representatives Treasury Laws Amendment (Support for Small Business and Charities and Other Measures) Bill 2023 - Consideration in Detail - Instant asset write-off and the energy incentive

The majority voted against amendments introduced by Warringah MP Zali Steggall (Independent), which means they failed.

What do these amendments do?

Mr Steggall explained that:

These amendments are important to improve the intent and quality of this legislation. Don't get me wrong; it is a good bill. Two key provisions, nonetheless, require amendment. The instant asset write-off and the energy incentive will no doubt go a long way in assisting small businesses feeling the immense pressure of inflation, interest rates and less consumer spending, amongst other issues. Small businesses are the backbone of the Australian economy. They account for one-third of Australia's GDP and they need targeted support. At the moment small businesses are facing a perfect storm. At home, like all Australians, they are facing cost-of-living price increases and high mortgage rates, but they're also facing reduced revenue in their businesses as consumers spend less but energy prices increase. It's incredibly important that this bill actually achieve its intent by being well targeted. The amendments I am proposing, after consulting with the Manly Business Chamber, the Mosman Chamber of Commerce and the Warringah Chamber of Commerce in my electorate, and the Council of Small Business Organisations Australia—COSBOA—more broadly, give all small businesses certainty and bring forward cash, giving them the opportunity to get more back at tax filing time and allowing them more time to invest and reduce their energy bills.

In relation to the asset write-off, the amendments seek to increase the threshold for the instant asset write-off and the energy incentive bonus, taking the threshold from $20,000 to $50,000 respectively. Respectfully, for businesses to actually have the benefit of this provision, $20,000 is not sufficient. If we are talking about energy efficiency measures, whether it's rooftop solar, a battery, heat pumps and other efficiencies like LED lighting, these are all going to be much more significant than $20,000.

Amendment text

(1) Schedule 1, heading, page 4 (line 1), omit "$20,000", substitute "$50,000".

(2) Schedule 1, item 1, page 4 (line 6), omit "30 June 2024", substitute "30 June 2025".

(3) Schedule 1, item 2, page 4 (line 9), omit "30 June 2024", substitute "30 June 2025".

(4) Schedule 1, item 4, page 4 (line 15), omit "$20,000", substitute "$50,000".

(5) Schedule 1, item 4, page 4 (line 18), omit "30 June 2024", substitute "30 June 2025".

(6) Schedule 1, item 4, page 4 (line 21), omit "30 June 2024", substitute "30 June 2025".

(7) Schedule 1, item 5, page 4 (line 24), omit "$20,000", substitute "$50,000".

(8) Schedule 1, item 5, page 4 (line 27), omit "30 June 2024", substitute "30 June 2025".

(9) Schedule 1, item 6, page 5 (line 1), omit "$20,000", substitute "$50,000".

(10) Schedule 1, item 6, page 5 (line 4), omit "30 June 2024", substitute "30 June 2025".

(11) Schedule 1, page 5 (after line 4), after item 6, insert:

7 Review of instant asset write-off for small business entities

(1) The Minister must cause an independent review to be conducted of the operation of section 328-180 of the Income Tax (Transitional Provisions) Act 1997.

(2) Without limiting subitem (1), the review must consider how the operation of that section has helped small business entities.

(3) The persons undertaking the review must give the Minister a written report of the review by 30 June 2025.

(4) The Minister must cause a copy of the report of the review to be tabled in each House of the Parliament within 7 sitting days of that House after the report is given to the Minister.

(12) Schedule 2, item 1, page 6 (line 12), omit "$20,000", substitute "$50,000".

(13) Schedule 2, item 1, page 6 (line 14), omit "30 June 2024", substitute "30 June 2025".

(14) Schedule 2, item 1, page 7 (line 6), omit "1 July 2024", substitute "1 July 2025".

(15) Schedule 2, item 1, page 7 (line 11), omit "1 July 2024", substitute "1 July 2025".

(16) Schedule 2, item 1, page 7 (line 21), omit "30 June 2024", substitute "30 June 2025".

(17) Schedule 2, item 1, page 8 (line 28), omit "1 July 2024", substitute "1 July 2025".

(18) Schedule 2, item 1, page 9 (line 14), omit "30 June 2024", substitute "30 June 2025".

(19) Schedule 2, page 10 (after line 32), after item 1, insert:

2 Review of small business energy incentive

(1) The Minister must cause an independent review to be conducted of the operation of section 328-465 of the Income Tax (Transitional Provisions) Act 1997.

(2) Without limiting subitem (1), the review must consider how the operation of that section has helped small business entities.

(3) The persons undertaking the review must give the Minister a written report of the review by 30 June 2025.

(4) The Minister must cause a copy of the report of the review to be tabled in each House of the Parliament within 7 sitting days of that House after the report is given to the Minister.