The Government will back small businesses by reducing their tax rate to 27.5 per cent, starting with businesses with a turnover of less than $10 million on 1 July this year.
The Government will decrease the tax rate for all companies to 25 per cent by 2026-27.
As many small businesses are not companies, the Government will also extend the unincorporated tax discount to unincorporated businesses with annual turnover of less than $5 million and increase the discount to 8 per cent on 1 July 2016, up to a maximum value of $1,000. After the initial increase, the discount will be increased in phases to a final rate of 16 per cent in 2026-27.
Over 3 million businesses will gain access to either the lower tax rate or higher discount in 2016-17.