NSW Treasurer Dominic Perrottet has revealed that the state’s payroll tax threshold will be increased to $1.2 million, up from $1 million.
The tax relief announcement comes ahead of Tuesday’s state budget, with Mr Perrottet also revealing a $5 million tendering support service to help small businesses win a share of the $40 billion that the NSW government spends in procurement each year.
The payroll tax threshold increase comes after NSW Premier Gladys Berejiklian announced a four-year payroll tax-free period for businesses that create at least 30 new net jobs.
NSW Treasury now predicts the state’s unemployment rate will drop from a peak of 7.5 per cent in the December quarter 2020 to around 5.25 per cent in June 2024.
“Our strong budget position has allowed us to weather the most severe economic storm in a generation, and we will continue to lead the way in job creation and supporting business through the 2020–21 budget,” Mr Perrottet said.
Minister for Finance and Small Business Damien Tudehope said $5 million tendering support service would help small and local businesses, including regional suppliers, submit tenders and negotiate government contracts.
“Many small businesses are not aware of the opportunities that exist or are unfamiliar with the NSW government tendering processes. They will benefit from additional guidance and support,” Mr Tudehope said.
“Small businesses make up 97.5 per cent of businesses in NS,W and by generating more work for local and small businesses through existing government spending, we will support jobs, families and local communities.”
Mr Tudehope also noted that the program would align with the existing SME and regional procurement policy, which requires government agencies to first consider buying goods and services from an SME for all direct procurements up to $250,000.
“The policy’s small business exemption allows government departments to buy directly from small businesses for any purchases up to $50,000 even if there is a mandated whole-of-government contract in place,” he said.
NSW Small Business Commissioner Chris Lamont said the Small Business Commission would develop targeted information and support to assist small business put their best proposals forward.
“For some small and medium enterprises, it’s hard to know where to start; this measure will provide practical support and assistance,” Mr Lamont said.
Jotham Lian is the editor of Accountants Daily, the leading source of breaking news, analysis and insight for Australian accounting professionals.
Before joining the team in 2017, Jotham wrote for a range of national mastheads including the Sydney Morning Herald, and Channel NewsAsia.