The Federal Government has issued its much-anticipated budget for the coming year. Read on to find out where the wins are for small business and hospitality.
Beer tax to stay high
One promise that did not come was the hospitality industry’s push to cut the tax on draught beer.
More than 20 backbenchers, in touch with their communities, supported the move by the Clubs and Hotels associations to cut the “tax on socialising” by 50 per cent, but this plea has fallen on deaf ears and Australians will continue to pay the fourth highest draught beer taxes in the world.
The beer tax increases twice every year, with no signs of stopping.
Fringe Benefits Tax stays the same
There are no changes to the Fringe Benefit Tax (FBT) system, which favours large-scale sophisticated employers over small business. This was another change that was pursued but not delivered for the clubs and hotels sectors.
Employment to get a boost
Offering some positivity for the challenged hospitality industry, the budget is bolstering aspects of employment. A further $365 million will go into the Boosting Apprenticeship Commencements scheme, with enrolments now set to close three months later, at the end of June. The scheme subsidises half of an apprentice’s wages during their first year, up to $7,000 per quarter, dropping to smaller subsidies in years two and three.
There are also hiring subsidies for seniors with disabilities, offering up to $10k for employers.
Reduction to ATO uplift payments
Many businesses making PAYG payments to the ATO are subject to an ‘uplift’ rate, being a buffer beyond their scheduled payments for which they can later apply for a refund if they end up paying more than their actual liability. This uplift rate has been at 10 per cent, but has been reduced to two per cent throughout FY23, allowing employers to hold on to more of their cash.
Fuel tax to go down
This incorporates the fuel excise cuts, which came in higher than pundits expected, halving the current tax of 44.2 cents per litre to 22.1 per litre.
Other key aspects of the budget include investment in digital skills, changes to employee share schemes, and infrastructure upgrades.
Commentators noted the presence of many announcements that are in fact reiterations of spending already pledged or spent, and talk of new legislation that has actually already been passed.
Conversely, other measures have been criticised for depending on legislation yet to be passed – reliant on the LNP being returned to power.
A key metric of concern was the deficit, which AMP reported came in for FY23 expected to be $80bn – down from the $99.2bn projected for 2021-2022.
A survey of 528 Australian SMEs by Employment Hero found more than two-thirds of business owners see tax reform as very important for their business, ranking it second behind inflation.
And the No.1 change operators wanted, according to the survey, was a broadening of the rules around business expenses, as championed by the hospitality industry.