Printers with turnovers of less than $2m will be eligible for the government’s latest business incentive to help the nation ride out the economic storm, with a host of tax breaks now available.
In a surprise announcement the government will allow small businesses some significant buffers on their tax obligations, which many are struggling to meet. These include a 12 month interest free holiday on any outstanding tax debts, a two month deferral of the quarterly BAS statement due in July, and a reduction in tax and goods and services tax instalments for 2010.The measures are designed to assist struggling businesses with their cash flow from failing at a time when business and consumer spending is being reined in.
More than 700,000 small businesses are currently in debt to the tax office, to the collective tune of some $6.5bn. IN addition to the interest holiday on tax debt and the deferral in BAS small printers will see a reduction in PAYG instalments for the 2010 tax year, with the GDP figure used to calculate instalments slashed from 9 per cent to 2 per cent. There will also be a reduction in GST quarterly instalments for the 2010 tax year.
Tax commissioner Michael D’Ascenzo made the announcement at a small business gathering, declaring that the tax office recognised the difficult conditions business were operating in.
However he said the government’s largesse would not extend to businesses that showed little hope of escaping the downturn, and he also announced the tax office would be increasing its auditing and checking scope to ensure businesses do not try to cut their tax bill through illegitimate means.
D’Ascenzo recognised that the biggest challenge facing his office was to differentiate between businesses in temporary cash flow difficulties and those with more endemic problems.
