Business measures pass senate

Joe Hockey would wish it was always like this.

In just five weeks the government’s small business package, a key measure of the treasurer’s second budget, passed in the Senate on Monday with just over an hour’s debate.

That’s in stark contrast to some of the measures in his controversial first budget, which have been ditched or remain stalled in the upper house a year on.

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The small business package is aimed at giving a much-needed lift to economic growth and creating the environment for small firms to employ more staff.

“Small businesses are often the entities that test and pioneer innovative ideas and business practices,” Finance Minister Mathias Cormann told the Senate.

That was critical to future economic growth job prospects and improved living standards, he said.

From July 1 small companies – those with an annual turnover up to $2 million – get a 1.5 percentage point cut in their company tax, bringing the rate down to 28.5 per cent.

Unincorporated businesses get a five per cent discount, capped to $1000.

The cost to the budget is about $3 billion over four years.

Another major component of the package is a $20,000 instant asset write-off, which began on budget night and lasts for two years at a cost of $2.05 billion.

There are also initiatives to help start-up companies.

In the Senate only Greens senator Peter Whish-Wilson held up an even quicker passage of the package, asking a series of questions of Senator Cormann.

He expressed concerned sole traders could rort the asset write-off by purchasing multiple assets under a newly-established business and then folding that company.

Senator Whish-Wilson said he envisaged “very valid” scenarios where the government could be ripped off.

“It’s very easy to set it up,” he said.

“If we had our way we would have seen this capped at $20,000 per business, not per asset, and we would have liked to have seen it in perpetuity.”


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