The Federal Government has thrown $5 billion at small businesses in a bid to get them spending more, presenting an opportunity for brokers to discuss sums insured.
Boosting small business growth was a key focus in the Federal Budget handed down yesterday, which delivered a previously announced tax cut of 1.5% to all businesses with an annual turnover of less than $2m.
One of the biggest announcements was to also allow those same businesses to claim immediate tax deductions for every purchase of an asset worth less than $20,000.
The previous threshold for instant asset write-offs was just $1000.
Treasurer Joe Hockey says the changes mean more money for small businesses to invest in growing their business.
“If you run a cafe, it might be new kitchen equipment, or new tables and chairs,” he says.
“If you’re a tradie, it might be new tools or a computer for the home office.
“Cars and vans, kitchens or machinery … anything under $20,000 is immediately 100% tax deductible.”
Commentators expect that the changes, if passed by Parliament, will lead to a flurry of new spending by small businesses, meaning many will also have to increase their sums insured if they are to maintain adequate insurance cover for their assets.
Recent research found only one in five property, business interruption or liability policies had any increase in sums insured over the past year.
The budget also confirmed a spend of $2.1 million for the Northern Australia Insurance Premiums Taskforce.