CHALMERS OFFERS LITTLE FOR BUSINESS

Jim Chalmers' first budget has only a modicum of support for print businesses, with the federal treasurer spending the extra tax revenue business has delivered on welfare, aged care and mass energy relief.

 There are a few bright spots for small business – the majority of the print industry – with an extension of the instant asset write off, encouragement to buy energy efficient assets, and small relief for their own energy bills. However there was no real incentive for investment, little in the way of tax reforms, or in skills and training support.

Encouragingly Chalmers – who has presided over the first surplus since Peter Costello – did predict that inflation would be back to between two and three per cent within two years, and he says unemployment will stay low, but with immigration set to surge over the next two years the dire labour shortage that printers, and most other businesses are facing, should ease.

Commenting on the budget, Charles Watson, PVCA, said, "It is not a great budget for print. It doesn't address the measures we were looking for. It is no surprise but it is disappointing."

"We wanted to see productivity increases articulated, we wanted to see incentivisation for business to invest and grow, we have a skill and labour shortage and there remains a lack of clarity in how that will be addressed."

In the budget the instant asset write-off threshold will be extended and increased to $20,000 from 1 July for a year. It will apply to businesses with a turnover of less than $10m, and means the entire cost can be deducted from the bottom line, provided the asset is used in the year. There is no limit to the number of assets that can be purchased.

Small businesses will also get a further tax deduction of up to $20,000 if they invest in energy efficient equipment and facilities.

For companies with a turnover of less than $50m, any investment in assets that support electrification and more efficient use of energy – such as cooling and heating systems - will be able to deduct an additional 20 per cent of the cost of depreciating assets that are eligible under the small business energy incentive measure.

All businesses with a turnover of less than $50m will receive a payment of $650 off their power bills, which will be of little comfort to those running power hungry presses.

Watson said, "The instant asset write off extension is welcome, but the reality is printers can't buy much of an asset for less than $20,000. The $650 energy relief is not going to make a dent in most printers power bills."

Under the new budget skilled migrants will see their base salary ratchet up to $70,000 from $54,000, to access the Temporary Skilled Migration Income Threshold. Visa processing capacity will be increased for temporary skilled workers, and for unskilled workers, particularly from the Pacific, more training places will be opened up.

From July 2026 employers will need to pay Super at the same time as they pay salaries and wages, rather than once a quarter as they do at present. The move is designed to ensure workers are being paid their Super, to ensure super isn’t used to prop up cashflow, and to ensure that the ATO doesn’t have to pay out when a company goes broke.

The ATO will get an extra $40bn to ramp up its tax compliance operations, with the tax body aiming to get back $9bn over five years, focusing on those avoiding GST and personal tax.

Thee already announced fee-free TAFE places will not help the print industry according to Watson.

Among other measures the government is spending $10m on a household recycling “consumer behaviour change programme” over the next two years, in a bid to get the public to be more deliberate in their recycling actions.

PVCA will release an industry advisory and budget synposis to members tomorrow.