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The pledge would allow small businesses with revenue up to $10 million an additional 12 months to make use of the measure.
Following the announcement earlier today, CPA Australia and Chartered Accountants ANZ (CA ANZ) said while the one-year extension was welcome, they stood by the opinion that the measure should be permanent and should not be a political issue.
CPA Australia business investment lead Gavan Ord said the body was pleased with the extension, but permanency would encourage crucial investment.
“Long-term certainty is crucial for businesses, and the full potential of this policy to support smaller businesses will never be realised if it remains an annual measure,” he said.
“In times of significant uncertainty, such as yesterday’s US tariff announcement, businesses need the next government to adopt a long-term approach to providing incentives to the SME sector.”
“Businesses hit by yesterday’s tariff announcements will be considering necessary investments to maintain profitability, such as diversifying their markets. A one-year extension to the regime is a step in the right direction but it is still insufficient.”
The Coalition previously pledged to make the instant asset write-off measure permanent, with a higher cap of $30,000.
Ord said the measure was important enough and needed bipartisan support, that the parties should stop using it as political leverage or “election sweeteners.”
CA ANZ echoed this sentiment, stating that despite it being a needed extension and providing relief for at least another year, it did “not go far enough.”
As part of its seven policy asks, the accounting body pushed for the instant asset write-off to be made permanent ahead of the upcoming election on 3 May.
Susan Franks, CA ANZ tax, superannuation and financial services leader, said this welcome extension would reduce red tape and increase cash-flow certainty.
“Since 2015, the instant asset write-off initiative used by small businesses to claim a deduction for the cost of an asset has been clouded with uncertainty. It has been extended by governments in power at the time, again and again, often right before it’s due to expire,” she said.
“The promise of another 12-month extension continues access to a crucial cash-flow tool, but it doesn’t resolve the underlying issue of ongoing uncertainty for small businesses around this policy.”
“The political debate about the instant asset write-off has moved on. Various independents and other parties are all calling for the instant asset write-off to become permanent. The debate is now focusing on the amount, which varies from $20,000, $30,000, and $50,000.”
Both CPA and CA ANZ noted the SME community deserved more and hoped this was not the last of the announcements to help support grappling small businesses.