David Gillespie (Lyne, National Party) Share this | Hansard source

Unfortunately, the other side does not realise the Senate is not sitting today. Maybe they just wanted the legislation to sit on an empty bench on the tables up there. The attendants have it all locked up. Democracy is what it is. There are lots of coalition people who want to speak, so I do not want to dwell too long—because good news is here. If you are an unincorporated company, a sole trader or the like or a tradesman and you are operating in the Lyne electorate, once this legislation is through it will be backdated to that magical date that the biggest minister for small business has spoken about—that golden day of 12 May—and you will have a five per cent tax cut up to the value of $1,000.

There is also the matter of simplified depreciation. This means that instead of the charade of working your accountant to the bone with various depreciation schedules, each and every piece of equipment up to the value of $20,000 is immediately written off in one year. If you have equipment greater than $20,000 it can go into a pool and then it gets an accelerated depreciation—10 per cent in the first year and 30 per cent for the next three years—rather than having some items depreciate over 30 years. If your whole pool of small equipment is less than $20,000 you can put it into the less-than-$20,000 one and write it off directly. That will give you an improvement in cash flow of about $4½ thousand for the average small business. That is to your bottom line.

In the Lyne electorate we have about 1,800 registered agricultural businesses. They all have fences, troughs, dams, tanks and bores, and some of them even have windmills, but the benefit to them is that the write-off on this equipment, whether it be a fence, comes up in one year. You do not have to depreciate it over three years

That is going to be a huge benefit to your bottom line, particularly whilst we have got good commodity prices, and for once in your life you are going to make a profit out of your farm and you have the opportunity to have a tax break. It is a question of intersecting good things happening: a tax break when you are making a profit and you have more tax liabilities. And we are giving you a head start on that.

Also, for fodder storage, for putting aside grains or all sorts of things in sheds, you have the ability to accelerate the depreciation over three years instead of 30 years. Those who run their businesses with franking credits will have their franking credits remain at the 30 per cent rate, even though their tax rate is at 28½ per cent.

That will keep things simple, it will be beneficial to your bottom line and will improve your cash flow. All sorts of other things that we have done for small businesses and for apprentices have been mentioned by other speakers, like the $20,000 up-front trade support loan for apprentices, with a $5,000 discount if they complete their apprenticeship on time. We have recently announced Work for the Dole and work experience programs. There are so many good things in this budget, but the small business tax changes and the accelerated depreciation are such a tonic.

Compare that with what happened with the Labor government in the last administration: we had 519,000 fewer people employed and the percentage of small businesses went from over 52 per cent to about 43 per cent. The proof of the pudding is in the results: you have one government, led by the ALP, that did not have small businesses flourishing. And you have what we have happening now, where small businesses are going to have a better outcome and a better cash flow. I commend these bills to the House.

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