Updated December 06, 2019 06:45:57 A new system for taxing Australian businesses will be introduced in 2018, as part of the Government’s efforts to cut business tax bills.
The tax changes, to be announced in the Federal Budget, will see businesses pay a one per cent GST on all profits, rather than a one-off levy of 2 per cent on profits above a certain threshold.
Under the new system, businesses will also have to pay tax on the full amount of profit from a single transaction, rather that just the amount of profits from a sale.
Businesses will be allowed to sell goods or services for less than $50,000, which will allow for a lower tax bill.
The changes will also see the new $30 billion Business Tax Relief Fund be used to provide grants to businesses to pay back the GST.
A $30,000 grant will be available for up to $2 million worth of assets for businesses.
Business owners are already eligible for grants of up to 25 per cent of their taxable profits from goods and services.
The new grants will help businesses to reduce the cost of goods and reduce their turnover.
Business Minister Kelly O’Dwyer said the changes would be “an opportunity to increase investment in Australia’s small and medium-sized businesses”.
She said the government was looking at ways to reduce tax revenue for Australian businesses.
“The new tax measures will provide businesses with greater flexibility to grow and invest in the country’s businesses and the economy,” Ms O’Wyers said.
“They will also reduce business tax liability for many businesses, with the government’s goal of cutting business tax to 1 per cent by 2019-20.”
We are proposing a new taxation system in 2018 to allow small and marginal businesses to get back on their feet.
“The new system will allow businesses to maintain their independence and independence from Government and from external influences, and to create jobs and prosperity for Australians.”
The Federal Budget will be released later this month.