Federal Budget

Ms DIGANCE (Elder) (14:36): Can the Minister for Small Business update the house on the impacts of the 2015-16 federal budget on small businesses in South Australia?

The Hon. A. KOUTSANTONIS (West Torrens—Treasurer, Minister for Finance, Minister for State Development, Minister for Mineral Resources and Energy, Minister for Small Business) (14:36): I thank the honourable member for her question. I stand here today to welcome the $5.5 billion Growing Jobs and Small Business initiative announced last night as a part of the 2015-16 commonwealth budget.

When there are positive policy announcements by the commonwealth government, we will stand up in support, because by doing so we stand up for the people of South Australia, but we will always oppose those things that hurt our economy and our citizens. The government understands the important role that small business plays. Members should make no mistake that a vibrant small business sector is the foundation of South Australia's economy and the driving force of our employment and growth.

There are approximately 135,000 small businesses in South Australia with turnover of less than $2 million who could potentially benefit from last night's federal budget. For a small business with an annual turnover of below $2 million, the package includes:

a cut of 1.5 per cent in the company tax rate to 28.5 per cent for small businesses with an annual turnover below $2 million;

unincorporated small businesses receive a 5 per cent tax discount of up to a maximum per individual of $1,000 per annum, and an immediate tax deduction for every asset they buy costing less than $20,000 between now and June 2017—any assets over $20,000 can be added together and depreciated at the same rate; and

a $1.2 billion national wage subsidy pool targeting long-term unemployment with greater flexibility to help with up-front costs of hiring and training staff.

These tax changes go hand in hand with the initiatives that this government has launched, which will benefit the South Australian business community and encourage investment and job creation in the long term. I was pleased that the federal budget has taken steps to address the lack of confidence in the small business sector. This builds on steps we have already taken to provide an environment that supports small business.

In February 2015, the government launched a state tax review to ensure that our tax system continues to support those who are investing in the state and trying to create new opportunities that will provide jobs for South Australians. I intend to shortly announce our response to the issues raised during that review process, and to outline how our state's small business sector will be assisted.

South Australia's business environment already boasts the most competitive payroll tax regime in the nation, ranked by the Commonwealth Grants Commission as the second-best small business tax system as ranked by KPMG. In addition to reviewing state taxes, the government has committed to regulatory and planning reforms aimed at minimising cost to businesses, and the government's recent WorkCover reforms are expected to deliver savings to business of around $180 million per year each year from 2015-16. That should further improve the state's business cost competitiveness and stimulate business investment and jobs growth in the South Australian economy. So when the Treasurer does something right by South Australians it is this Labor government that will congratulate him.

I welcome the reforms he has made and I congratulate him on this initiative. They certainly need a confidence boost after the last 12 months of dysfunction in Canberra, they certainly deserve a confidence boost. Small business is the engine room of the South Australian economy and we want them firing on all their cylinders. I also note that of all the changes announced in the commonwealth budget for small business, none of them, not one of them, has ever been called on to be implemented by the opposition.