A last minute deal has been struck between the government and Senator Nick Xenophon to pass the Treasury Laws Amendment (Enterprise Tax Plan) Bill 2016.
The revised Bill enables:
- An increase to the aggregated turnover threshold to $10 million for access to small business tax concessions from 2016-17.
- Note that the current aggregated turnover threshold of $2 million will be retained for the small business CGT concessions.
- Progressive reductions in the corporate tax rate for base rate entities (corporate tax entities that carry on a business with an aggregated turnover of less than $50m) to:
- An increase to the aggregated turnover threshold to $5 million for access to the small business income tax offset from 2016-17.
- An increase to the unincorporated small business tax discount to 8% from 2016-17. The offset will be capped at $1,000.
The final amendments exclude businesses with an aggregated turnover of $50 million or more from the tax cuts. These entities will continue to pay a corporate tax rate of 30%.
The Bill has passed the Senate with amendment and will now go back to the House of Representatives where the Government holds a majority. The next sitting day to formally pass this Bill is 9 May.
