Installing solar panels would be one way to claim the promised tax deduction. Photo: Getty Photo: Getty
Major tax break announced for small businesses going green
Small and medium-size businesses that invest in energy efficient equipment could be eligible for a tax deduction of up to $20,000.
Treasurer Jim Chalmers on Sunday announced the Small Business Energy Incentive – to be included in next month’s budget – in a bid to help businesses manage the costs of cutting their energy consumption.
Up to 3.8 million businesses across Australia could benefit from the measure.
Businesses with a turnover of up to $50 million will be incentivised to electrify their cooling and heating systems, install batteries and heat pumps, as well as more efficient fridges and induction cooktops.
$314 million price tag
The maximum bonus tax deduction is $20,000 per business, and will cost $314 million over the next four years.
Dr Chalmers said small businesses will be front and centre in the budget.
“This incentive is all about helping small business save energy and save on their energy bills, support that comes on top of the direct energy bill relief for small businesses that will be a centrepiece of the budget,” he said.
“The Albanese government’s policies like the Small Business Energy Incentive are all about giving small businesses the leg-up they need to expand and grow.”
“Swapping out fossil fuelled devices and energy sources for renewable-backed electrification is the fastest, most cost effective way to decarbonise our domestic economy,” said Saul Griffiths
Small Business Minister Julie Collins said businesses were already facing increasing cost pressures, including from energy prices.
“This new incentive will help address costs, support growth and improve the resilience of Australia’s small businesses,” she said.
Energy Minister Chris Bowen said small businesses knew about the options to upgrade their facilities, but had struggled with up-front costs.
“The Small Business Energy Incentive unlocks that investment to help businesses save on their bills over the medium and long term,” he said.
Clean, green and cheaper
Smart Energy Council chief executive John Grimes said the scheme came at the right time.
“Ensuring our small business can take part in the energy revolution means cheaper energy costs that can be passed on to customers,” he said.
Rewiring Australia co-founder and chief scientist Dr Saul Griffith said the scheme would help permanently lower the cost of business.
“Swapping out fossil fuelled devices and energy sources for renewable-backed electrification is the fastest, most cost effective way to decarbonise our domestic economy,” he said.
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