Small businesses across South Australia are set for a major economic boost, with the Marshall Liberal Government today introducing legislation to exempt the state’s 3,200 businesses with taxable payrolls of up to $1.5 million from paying any payroll tax – a saving of up to $44,500 a year.
The move delivers on one of the Marshall Liberal Government’s key election commitments and is designed to help stimulate jobs growth and drive investment.
In another significant help to business, Premier Steven Marshall has announced the government will introduce a “phased-in or graduated tax schedule” for businesses with payrolls between $1.5m and $1.7m.
“At long last the economic handbrake is coming off small businesses in this state who will soon have more money in their pockets to reinvest into their operations to drive growth,’’ said Premier Marshall.
“Not only are we removing a major disincentive to businesses creating more jobs and employing more people, we’re making South Australia a much more attractive place in which to invest and grow.
“A further 400 businesses with payrolls between $1.5 million and $1.7 million will receive a welcome reduction in the amount of payroll tax they are required to pay through a phased-in approach.”
The Premier made the announcement as he toured family-owned mechanical engineering firm Kilic Engineering at Regency Park – one of the thousands of businesses to benefit from the tax cut.
The Payroll Tax (Exemption for Small Business) Amendment Bill 2018 will be introduced to State Parliament today, with the change to come into effect from January 1, 2019.
It lifts the existing tax-exempt threshold from $600,000 to $1.5 million.
Premier Marshall said provision had been made in the upcoming State Budget for payroll tax relief, with the reform expected to save businesses an estimated $44 million per year ($22 million for the half-year from January 1 to June 30, 2019).
“We were elected on a platform of more jobs, lower costs and better services for South Australians and we are delivering on that promise,’’ said Premier Marshall.
“This important tax cut is part of a suite of reform measures designed to stimulate economic growth and investment, including cuts to ESL bills for households and businesses, the creation of an additional 20,000 apprenticeships and traineeships over the next four years and the deregulation of shop trading hours.”
The State’s payroll tax receipts will be close to $1.2 billion in 2017/2018.