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The deferral of the instant asset write-off measure till next year has again left small businesses in an uncertain position, COSBOA has said.
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Small business laments deferral of instant asset write-off measure: COSBOA
30 November 2024
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The amendment to extend the $20,000 threshold for the instant asset write-off (IAWO) to 30 June 2025 was removed from the Responsible Buy Now Pay Later and Other Measures Bill last week in parliament before it was passed by both houses.
The government plans to reintroduce the IAWO measure, which was contained in schedule 7 of the bill, into another Treasury Laws Amendment Bill for debate at a later time.
The Council of Small Business Organisations Australia (COSBOA) said the government's decision to delay the measure until next year is "déjà vu for many small businesses" following the extreme delay with the passage of the same measure for the previous 2023–24 year.
COSBOA chief executive Luke Achterstraat said parliament had not learned from past mistakes in failing to legislate certainty for the program into the future.
“The IAWO is an effective program, but certainty is required for small businesses to take actual advantage of this tax incentive.
“While the government scrambled this week to pass dozens of bills before Christmas, the IAWO was kicked down the road, creating uncertainty for small businesses, particularly with the possibility of an early election."
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Achterstraat noted that small businesses operate on forward investment schedules.
"Many will feel like it’s Groundhog Day – a painful reminder of last financial year when the legislation was only passed a matter of days before the window for applications was due to expire," he said.
Achterstraat said the IAWO needed to be provided with funding certainty over the forward estimates and be made permanent.
“The annual bickering and finger-pointing has become tiring. It is time to make this program permanent and to lift the threshold to $100,000 to better capture the value of productive assets," he said.
“The threshold of $20,000 has not been reviewed in a decade and is no longer fit for purpose. Many productive items like tractors, commercial refrigeration and industrial machinery are well beyond the current threshold.”
COSBOA said that many small businesses were looking to plan for 2025 and challenged policymakers to stand up for small businesses.
“With a federal election around the corner, we expect to see a suite of measures from both parties that can boost our small businesses. Getting this program right is an obvious place to start,” Achterstraat said.
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