It’s time to make asset write-offs permanent

0

In 2015, the coalition government used its budget to reveal what we now know as the Instant Asset Write-off (or Temporary Full Spend to use the technical term).

This was the second federal budget I have reported on since SmartCompany and it was a real surprise moment that surprised and delighted many in the small business community.

In the days that followed, we were treated to numerous photo ops with ministers standing proudly next to a small business owner who was going to invest in a new coffee machine for his coffee, or some new machinery. It was, of course, the year of “Tony’s trades”.

The measure, which initially allowed businesses to immediately deduct the full value of a purchase up to $20,000 rather than claiming deductions over its lifetime, has been welcomed by the industry, and although the data has shown that attendance was not overwhelming in the years that followed, it helped create a sense of confidence among business owners who were willing and able to invest in growing their business.

Since then, almost every year, asset write-offs have been extended, expanded and, some say, retained to accommodate small businesses.

Today’s budget will be my eighth to SmartCompany and reports again suggest we could see another 12 months added to the lifespan of the metric (which admittedly received a massive upgrade last in 2020).

But if this government has seen fit to continue delisting for seven years, why not make it permanent?

Why not give small businesses the certainty of knowing that when they recover from the pandemic, they can fully deduct new purchases to get their coffee grinders going again?

Why continue to bring temporary and piecemeal changes to the small business sector, instead of substantial and meaningful changes?

Perhaps the answer is the election, which is only a few months away. But in my opinion, that’s a pretty good reason to make this budget measure (and others) permanent. To use one of this government’s favorite slogans, isn’t it time to make sure that the “engine” of the small business economy has the best chance of restarting?

The federal government likes to say that it “will always put small business first”. He should show us how.

Share.

Comments are closed.