In bringing down the 2020/21 Federal Budget, Treasurer Josh Frydenberg introduced a raft of measures to support businesses both in general across the board and targeted schemes for specific sectors. As emphasised by the Treasurer, the Prime Minister and the Minister for Finance, this budget is very much framed for a business-led recovery out of the COVID-19 recession/crisis and focussed on creating jobs.
The general business support measures include, but are not necessarily limited to and subject to eligibility:-
- Instant Asset Write-Off extended
- Investment Allowance Package
- Wage subsidies
- Losses Carry-Back
Personal income tax cuts as part of Stage 2 of the tax scheme introduced in the 2018 Budget have been brought forward and form a significant component of the 2020/21 Federal Budget. While not presenting a direct benefit to business per se and not of direct relevance to our services at Jade Equipment Finance, it is significant.
Your employees will have more in their pay packet (in some tax brackets) and so will millions of other tax payers. Tax payers which may well be your end consumers. Whether you sell directly or your products are part of the supply chain for consumer products, the tax cuts are designed to drive spending.
But more relevant and of greater interest to our Jade customers is the support to key industries which represent significant equipment purchases.
Housing Sector Support
For businesses operating in building and construction, specifically new residential housing, the budget included specific measures to boost the sector. The first home buyers grant was extended/expanded for new home purchases.
For many tradies, excavation contractors, concreting businesses, building materials suppliers and many other building-related businesses this may be the incentive to upgrade your existing equipment. Add to the budget measure incentives of the asset write-off schemes and the historic low interest rates and an equipment purchase at this time may be a very attractive proposition. If you’d like to do some ‘behind-the-scenes’ calculations, head to our Equipment Finance calculator to work out rough estimates on possible repayments for various equipment.
Infrastructure Spending
Both Federal and state and territory governments have been pushing hard on infrastructure as a big driver for the economy – both in good and in not so good times. The 2020/21 Federal Budget continued that theme with major investment in projects across the country.
The formal budget announcement was in some ways overshadowed by pre-budget announcements which included the latest rounds of grants to local councils under the existing Bridges Renewal Program and the Heavy Vehicle Safety and Productivity Program.
But there is $10 billion in the budget for bridges, rail and road projects in the federal infrastructure plan which covers 10 years. Depending on your particular state and business activity, there are shovel-ready projects which are facilitated through an additional $2 billion in the budget.
What could this mean for you? More work and the need to upgrade equipment?
Excavation equipment, road rollers, water trucks, general trade equipment, engineering equipment, tunnelling machinery amongst other machinery will need to be called into service to make these projects a reality.
With the investment allowances and our track record in delivering cheap equipment finance interest rates, Jade Equipment Finance may put you in the box seat with a great finance offer to acquire the assets you require. The finance deal you secure is critical to your cash flow and may determine how competitive you will be when competing in the project tender/quoting process.
Before making concrete decisions on equipment purchases, you are welcome to have an obligation-free discussion with a Jade Equipment Finance consultant about your options and source a quick quote.
Prioritising Manufacturing
In a major speech to the National Press Club in the week prior to the budget announcement, the Prime Minister, Scott Morrison, outlined the Government’s plan for major support for key areas of the manufacturing.
The plan has six key priority areas: mining and resources, medical, clean energy and recycling, defence, space and food and beverage. We covered the detail of this budget program in another article which you can access in our news and articles library.
This program covers many businesses both directly and indirectly through supply chains. If this budget initiative sparks your interest in investing in plant, machinery and equipment, your Jade consultant will assist by structuring a cost-effective finance package. We are accredited with many banks and lenders including specialist equipment lenders. These specialists are usually better placed and better structured to offer greater flexibility on finance interest rates and terms as they have a greater understanding of equipment acquisitions.
Capture the Opportunities
Jade Equipment Finance is well placed to assist businesses capture the specific industry opportunities presented by the Federal Budget. We have experience and expertise in sourcing cheap equipment finance across many industries and for all types of businesses – sole traders, large corporations, SMEs, partnerships and family enterprises.
To discuss how we can assist you capture the opportunities presented in the Federal Budget, contact Jade Equipment Finance on 1300 000 003
DISCLAIMER: THE DETAILS, INFORMATION, DATA AND MATERIAL PRESENTED IN THIS ARTICLE HAS BEEN SOURCED, IN FOOD FAITH, FROM REPUTABLE SOURCES IN THE PUBLIC DOMAIN. INFORMATION IN RESPECT OF GOVERNMENT ANNOUNCEMENTS, POLICIES, PROGRAMS, MANUFACTURER’S GOODS AND SERVICES AND OTHER SUBJECT MATTER IS OFFERED FOR GENERAL INFORMATIVE PURPOSES ONLY AND NOT IN ANY WAY INTENDED AS A SOLE SOURCE FOR THE PURPOSE OF MAKING FINANCIAL DECISIONS. NO LIABILITY IS ACCEPTABLE FOR ANY ERRORS OR MIS-INTERPRETATION OF FACTS AND MATERIAL. IF A PERSON CONSIDERS THEY REQUIRE FINANCIAL ADVICE IN REGARD TO THEIR SPECIFIC AND INDIVIDUAL CIRCUMSTANCES, THEY SHOULD SEEK INDEPENDENT ADVICE FROM A FINANCIAL ADVISOR.
