After a simple summary of the 2023-24 Budget handed down by the Federal Government, and what it means for you and your business?
We’ve got you covered, as Treasurer Jim Chalmers has presented the Labor Government’s first full year budget, outlining a range of key measures.
The announcements focused on easing the cost of living over the coming years, addressing the challenges of a slowing economy, and bolstering the healthcare system.
Treasurer Chalmers highlighted a few key economic forecasts, including
- GDP – Real GDP growth is expected to be at 1.5 per cent in 2023-24, before rising to 2.25 per cent in 2024-25
- Falling Inflation – Government predicts inflation has peaked and is starting to moderate. Inflation is projected to fall to 3.25 per cent by 2023-24 and will return to the Reserve Bank’s target band of 2-3% by 2024-25
- Cost of Living – The first initiative is targeted at reducing energy bills for eligible Australian households. The second initiative announced was the establishment of the Household Energy Upgrades Fund to support home upgrades that improve energy performance and save energy.
The Labor government surprisingly announced a surplus for the 2022-23 financial year of $4.2 billion, which represents significant turnaround from the projected $36.9 billion deficit forecast in the October 2022 Budget. There is an expected deficit of $13.9 billion in 2023-24.
What did the budget deliver for small businesses?
- A $20,000 instant asset write-off for small businesses with annual turnover below $10 million will be in place from 1 July 2023 to 2024.
- A new Small Business Energy Incentive will also be introduced, providing businesses with turnover less than $50 million with a bonus 20% tax deduction for eligible depreciating assets up to $100,000 for energy saving upgrades.
- The Budget will also provide $23.4 million to support small businesses to build resilience to cyber threats.
- Support to help SMEs compete for tenders and improve SME awareness of federal government contracts
- Cash flow support by halving the GDP adjustment factor to 6 per cent (applied to PAYG and GST instalments).
Accelerated cash flow of utmost importance
In these still turbulent economic conditions it is critical for a business to be on top of its finances. Having a strong working capital base to not only take advantage of opportunities in peak seasons, but also ride out the slower periods, will often be your biggest competitive advantage. Want to understand what the best working capital solutions are to help accelerate your business growth? Contact our team of finance specialists today.