Differential tax rates for small business 'not a bad thing', says IPA

A further lowering of the company tax rate for small business would help Australia drive productivity and future economic growth, according to the Institute of Public Accountants

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“The 2015 Federal budget made steps in the right direction with a 1.5 per cent corporate tax cut for incorporated small businesses. Unincorporated small businesses also receive a tax discount of 5 per cent up to a cap of $1,000,” said IPA CEO Andrew Conway.

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“Small business is still defined as using the existing $2 million turnover test which has not been indexed since it was introduced in 2007. If this had been indexed it would now be $3 million.”

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Mr Conway added that the IPA has long advocated for a concessional income tax rate for small businesses to compensate for the regressive nature of compliance costs on such entities.

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“It must be recognised that the long term well-being of the nation is dependent on the productivity and growth of the small business sector.”

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strategien für binäre optionen “A two-tier tax system is not as bizarre as some organisations have touted but can be quite the opposite in delivering a more efficient tax regime which is fairer for small business. A lower tax regime for small business is already part of the corporate tax regime in a number of OECD countries including Canada, France and Japan.
“Whilst differential rates of taxation may add some limited degree of complexity, it is more than offset by the benefits gained by small businesses being able to reinvest cash flow savings from lower taxes to sustain their growth,” Mr Conway concluded.

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