2020 Federal budget creates opportunity for Business. Many businesses have been interested in upscaling and acquiring new assets but have not seen it to be feasible? We are entering a new era where the government is practically paying you to scale your business up. The federal 2020 budget announced this week was probably the most anticipated in Australian history since World War II. The economic situation is dire with Australia losing about 5% economic output in just 6 months. A recession generally has about 3% loss over a 12-month period. This is an economic problem we haven’t seen before. Our usual way of dealing with it by lowering interest rates has been tapped out. This puts all the emphasis on the federal government’s budget. There are two major hurdles the government has. The first is to find how to wind up short-term stimulus without affecting economic recovery. The second is a longer-term challenge in creating a pathway to recovery. Building confidence for business investment is key.
Although the government’s debt may appear concerning, this will be the lifesaver for many businesses. It must be noted that this debt is locked in at an all-time low rate. This injection of funds to businesses will grow new and existing industries and create jobs.
The following are some winners from the 2020 Federal budget:
- Construction ($688M Home Builders Scheme $14B Infrastructure)
- Vaccines ($1.7B University of Oxford & University of Queensland CSIRO)
- Business (Instant Asset Write-off)
- Farmers ($2B Water Infrastructure)
- Young People (Wage Subsidies)
- Tourism ($57M funding)
- Manufacturing ($1.3B)
New Era with Opportunity for Business
Scott Morrison’s plan to rebuild our economy is to create opportunity for business, to recover and become a more self-reliant nation. We are about to enter a new era with Australian manufacturing, construction and farming.
The plan for $1.5B invested over four years through the “Modern Manufacturing Industry Strategy” is to build our manufacturing industry and make it more competitive and resilient. Resulting in creating a dynamic and highly skilled industry.
Manufacturing is critical to Australia’s economic recovery. It has the potential to deliver our future.
$1.3B “Modern Manufacturing Initiative” (MMI)is another opportunity for business funding is to focus on investing in projects that will help manufacturers upscale and create jobs. Along with added incentives like instant asset write-off’s business has the ability to grow at the expense of the government.
Modern Manufacturing Initiative will support 6 national manufacturing priorities:
- Resources technology and critical mineral processing
- Food and beverage
- Medical products
- Recycling and clean energy
Overall Intension is Opportunity for Business
The 2020 budget’s intension is to open up opportunity for business and give confidence in our future. It is designed to encourage average Australians to go out and spend money and stimulate our economy. With the instant asset write off and associated tax incentives it will encourage businesses to upgrade and upscale. It sets a scene for Australian business and consumers to be active in the economy. The government wants jobs for the average Australians so that they can pay tax and spend the rest in business is that will grow and generate more jobs.
Australian business now has the ability to write-off the full cost of any new equipment they purchase. This is a great opportunity to upscale and update your business equipment at the government’s expense.
One of the biggest hurdles in taking advantage of the government’s asset write-off is not having the cash upfront for your purchase.
If your business does not have spare dollars to invest in new machinery and vehicles, then our specialist finance broker service is your solution. You may be surprised with just how quick and easy it can be to purchase business equipment with Will Finance lending criteria.