VICTORIAN businesses could receive thousands of dollars in tax relief under a bold new policy proposed by Victorian Opposition Leader, Michael O’Brien.
The plan to cut payroll tax may well be designed with a view to convince the general public to consider an alternative Government, particularly in the lead up to the election, irrespective, the proposal has already won the backing of the Victorian Chamber of Commerce and Industry (VCCI).
The plan, should it be rolled out, is estimated to cost us $1.3B in state revenue and, is likely to be hugely popular amongst the business community – and rightly so it would seem.
Almost 42,000 Victorian businesses are forced to pay the state-specific payroll tax under the current structure.
The tax applicable to a business, is dependent on its size and calculated by the company’s wages bill.
The Coalition’s proposal would see the tax-free threshold lifted from the current $700,000 to $1.6M, bringing it in line with other states and territories across the country.
If successful, the rollout would mean that 15,000 businesses across Victoria no longer had to pay the tax (whilst their business remained at its current size that is). The Coalition has also proposed to change the tax structure, so that businesses do not have to pay the full payroll tax rate of 4.85 percent, until their wage bill hits $2M.
The Coalition estimates the move would save some small business, up to $43,650, and encourage them to expand.
The Government has been quick to slam the plan, by warning the policy would result in cuts to government services and infrastructure projects.
