Power Equipment Australasia

OPINION Budget and Beyond Each May there are thousands of words published on the Federal Budget. Now, as the dust has settled, I want to pick out the items that mean the most to the power equipment sector. Instant Asset Write Off - the party is over: For the past five years, small businesses have been able to write off the total value of every asset purchased, up to the value of $150,000. That fuelled the purchase of imported 4WDrives, doing little for the Australian economy. Not enough was spent on assets that supported jobs and delivered the business long term benefits like a 100kW solar system. The scheme is still in place but now there is a cap of $20,000 for any one purchase by a small business (turnover less than $10m p.a.). That could be good news for this industry. Business customers will stop flirting with expensive cars and turn their purchasing toward power equipment up to $20,000. Doctors and Aged Care to get a boost: Labour always loves Medicare Bulk Billing, which had almost disappeared, so don’t feel bad if you forgot what it is. This budget will see $3.5bn spent to resuscitate Bulk Billing by tripling the bulk billing incentives paid to doctors. After the Aged Care Royal Commission, there has been a lot of first aid given to the sectors, but as the Minister explained to the Press Club in June, now she plans to move forward. The first step is to increase funding and address staff shortages by delivering Aged Care workers a 15 per cent pay rise. Scammers beware: A national anti-scam centre will be established at a cost of $58m. This is not enough when you consider that Australians lost $3.1bn to scams in 2022 (up from $2bn in 2022). It’s a start, when you consider that currently no department wants to know if you’ve been scammed. The only conclusion is that we all need to stay alert for the foreseeable future. You may not fall for the scammer’s tricks, but what about your staff? Electricity Pricing: Around the time you are reading this column you may have been shocked by first electricity bill of 2023-24. I have seen advance contracts with a 40 per cent price rise. Many residential and small business accounts with go up by 25 per cent. The Treasurer has tried to soften the blow for residential consumers and for small businesses. Your business can get bill relief under the Energy Bill Relief Fund depending on the rules in your state. You don’t need to apply; your business will automatically receive bill relief on your electricity bills from July 1, 2023. I suggest that you look out for it in the bill, and check if they got it right. If not, call your supplier as a first step. To qualify, your business must be on a separately metered business tariff with your electricity retailer, and your annual electricity consumption must be less than 40MWh in Victoria; 50MWh in Western Australia; 100MWh in the ACT, NSW, and Queensland; 150MWh in Tasmania; 160MWh in the Northern Territory and South Australia. So how much will you get? $325 in Victoria and $650 in NSW, Northern Territory, Queensland, South Australia, Tasmania, or Western Australia. The clean energy sector has referred this budget as: “Finally delivering genuine action to harness the benefits of renewable energy and grow our economy through investing in Australia’s cutting-edge smart energy industry.” (John Grimes, Chief Executive, Smart Energy Council). A $2 billion fund to establish an Australian Renewable Hydrogen industry is a game-changing investment and will place our nation ahead on the frontier of this energy advancement. Small Business Energy Incentive program: Confirmed budget commitments for the recently announced scheme: - A 20 per cent bonus tax deduction for businesses with annual turnover of less than $50 million on spending that supports electrification and more efficient use of energy. - T o help small businesses make investments like electrifying their heating and cooling systems, upgrading to more efficient fridges and induction cooktops, and installing batteries and heat pumps. - U p to $100,000 of total expenditure will be eligible for the incentive, with the maximum bonus tax deduction being $20,000 per business. - Eligible assets or upgrades will need to be first used or installed ready for use between 1 July 2023 and 30 June 2024. $1 billion for Clean Energy Finance Corporation to provide green finance subsidies via major banks for residential home electrification and energy upgrades, including provision for landlords to support rental housing. The Labour Government has been in Canberra for just over a year, working on a budget they inherited. When Treasurer Jim Chalmers handed down the budget on May 9, it was the first clear statement of the direction that Canberra is heading. 16 | POWER EQUIPMENT AUSTRALASIA | JULY - AUGUST 2023