A popular tax write-off scheme for small businesses will be extended for another year in a significant win from the Budget for the sector.
The government has faced overwhelming calls to extend the scheme which allows small businesses to write off purchases up $20,000 instantly for tax purposes and was due to finish in June. The budget saw this scheme extended for another year.
![Small business owner Alecia Whitelaw was looking for incentives to hire and improvements to payment terms.](http://web.archive.org./web/20170619222035im_/https://www.fairfaxstatic.com.au/content/dam/images/g/v/w/0/z/g/image.related.articleLeadwide.620x349.gw11xw.png/1494382414227.jpg)
Australian Small Business and Family Enterprise Ombudsman (ASBFEO) Kate Carnell said the extension was welcomed
"We would have liked a lift in the $20,000 threshold for the instant asset write-off because for some industries, like farming, the $20,000 threshold is too low to enable them to purchase equipment," she said.
KPMG tax partner Simon Thorp said the move was important as tax cuts had not had much of an effect on the sector.
"This will provide a much needed shot in the arm for many small businesses across the country and will stimulate the economy and increase the investment and productivity of small business," he said.
"The extension of the asset write-off is very significant."
MYOB chief executive Tim Reed.said the move would encourage business growth and was "exactly the type of measure that delivers confidence to the business community."
Mr Reed has also expressed disappointment around Budget measures to introduce a new levy on businesses hiring employees on working visas.
"We are concerned about the extra compliance costs forced on small businesses in the courier and cleaning industries," he said.
Ms Carnell welcomed moves to better hold banks to account but said there was disappointment that the government had not tackled slow payment times.
This was one of the issues Gourmet Juniors owner Alecia Whitelaw raised as a key problem ahead of Tuesday's budget.
The extension of the asset write-off is very significant.
KPMG tax patner Simon Thorp
"Dealing with late payments as well is a really big issue for us. We love small business and a lot of our retailers are small businesses themselves and we give as much consideration. Our terms are seven days and we've had to wait up to three months for products that have been sold relatively quickly.," she said.
Another issue for Ms Whitelaw was red tape and the Budget funds the establishment of a $300 million fund to reward state and territory governments that removed unnecessary regulation.
"Less red tape would be wonderful to see in terms of accessing resources and grants," she said.
With Cara Waters