This week Federal Treasurer Dr Jim Chalmers handed down the 2023 – 2024 financial year budget for Australia.
The South Australian Business Chamber is of the opinion it is a modest budget for South Australian businesses, as the government has focussed on addressing cost of living issues, the health sector and Medicare.
It’s a budget that rides on the back of a commodities boom and high employment, good fortune which is unlikely to be in place in subsequent budgets. With business taking a backseat, there is little in the way of initiatives to address low productivity and drive economic growth.
Businesses in South Australia will benefit from a startup and SME Industry Growth Program worth $392.4 million, energy bill savings of up to $650 for eligible businesses, and tax breaks totalling $310 million for electrification of heating and cooling systems, installing batteries and upgrading to high-efficiency electrical goods.
The skills shortage also gets some assistance with additional fee-free TAFE placements and at a time of record low unemployment in the state, measures announced to increase women’s participation in the workforce are very welcome.
We are also keen to see what the Hydrogen Headstart Program worth $2 billion means for SA and particularly, Whyalla.
The budget outlined in 2023 – 2024 South Australia will receive $8.415B in GST entitlements. State Treasurer, Stephen Mullighan has advised the budget showed a $95m reduction in GST revenue. The South Australian Business Chamber looks forward to further investigation into GST entitlements and will be advocating for the State Government to encourage a fairer distribution across the states.
Over the coming weeks, the South Australian Business Chamber will be releasing its submission to the state government, prepared on behalf of the South Australian business community, highlighting 15 recommendations for consideration in the 2023 – 2024 state budget.
Hydrogen Headstart Program
A significant fund worth $2 billion to scale up hydrogen industry development in Whyalla, Gladstone, and Wollongong.
SA note: Investment in eastern state projects reduces our competitive advantage.
Industry Growth Program
A $392.4 million investment over 4 years from 2023 – 24 (and $68.2 million per year ongoing) to establish the Industry Growth Program supporting SMEs and startups to commercialise their ideas.
SA note: South Australia has a thriving ecosystem of new and SME businesses. Government funding facilitation of expertise through growth programs will encourage businesses to innovate and expand.
Energy relief and tax breaks
A small business energy incentive tax break to help small and medium businesses electrify and save on their energy bills providing $310 million in relief, supporting up to 3.8 million businesses to invest in electrifying their heating and cooling systems, installing batteries and upgrading to high-efficiency electrical goods.
Businesses with an annual turnover of less than $50 million will have access to a bonus 20 per cent tax deduction for eligible assets supporting electrification and more efficient use of energy, from 1 July 2023 until 30 June 2024.
Up to $100,000 of total expenditure will be eligible for the incentive, with the maximum bonus tax deduction being $20,000 per business.
Similar to some households, one million businesses will receive a one-off reduction of $650 on their power bills.
SA note: This is much-needed relief given South Australia’s current energy costs.
Enhancing Women’s workforce participation
Initiatives will encourage stronger women’s workforce participation, including expanded access to paid parental leave, a $72.4 million investment in training and retention measures for the childcare workforce, and changes to deliver more affordable childcare for 1.2 million families.
SA note: With the second lowest participation rates in the country, record low unemployment in the state, and ongoing skills and labour shortages, we encourage any measure that will increase participation and enable women with children to return to the workforce.
