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State Budget 2016 / 2017

By | July 8, 2016

hEADER sTATE

State Budget 2016 / 2017

Job growth is the focus of the 2016-17 South Australian budget, which delivers the first surplus in seven years.

Treasurer Tom Koutsantonis released the budget with a focus on its centrepiece: a $109 million Jobs Accelerator Scheme designed to encourage business owners to hire more workers in a move to support jobs growth in the state.

The scheme offers a grant of up to $10,000 over two years for each full-time equivalent job created in small and medium-sized businesses liable for payroll tax. Small businesses and start-ups who do not payroll tax can also apply for a grant of up to $4000 over two years. Further to this, small business receives a further boost with the continuation of payroll tax rebates for those with employee wage bills of under $1.2 million.

In addition, the state economy is predicted to grow at two per cent in the coming year, compared to a national growth rate of 2.5 per cent. SA is to be below the national growth rate every year until at least 2020. Until then, it is obvious that the focus is on the growth of local jobs and to support business innovation.

If you need more information or registration assistance on the Jobs Accelerator Scheme, please contact us today.

 

LOCAL ECONOMY

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The State Government has delivered a budget surplus of $258 million for 2015/16, the first since 2009/10. The 2016/17 Budget is predicted to achieve a surplus of $254 million which is forecast to reach $466 million by 2019/20.  After estimated economic growth of 1.5% in 2015/16, the State Government is relying on its budget measures to boost economic growth which it predicts to be 2% in 2016/17 before increasing to 2.25% in 2017/18 where it remains till 2019/20.

Since the Mid-Year Budget Review in December 2015, the State Government has revised down all taxation revenue forecasts by a total of $387 million over the next four years. GST revenue is also down by $240 million over the same period due to changes in estimates of the national GST pool and South Australia’s share of GST revenue grants.

 

JOB ACCELERATOR GRANT SCHEME

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Businesses that increase their number of SA employees will be eligible to receive a grant for each additional worker employed by them in a new position between 1 July 2016 and 30 June 2018.  The grant will be paid at the first and second anniversary date of employment.

A Job Accelerator Grant of up to $10 000 ($5000 each year for two years) per new full-time equivalent (FTE) job created is available for businesses liable for payroll tax in SA with total Australian wages of $5 million or less.

A Job Accelerator Grant for Small Business & Start-ups of up to $4000 ($2000 each year for two years) per new job created is available for most businesses that are not liable for payroll tax. This includes businesses with Australian wages below the payroll tax free threshold (currently $600 000) and most organisations that are exempt from payroll tax (e.g. public benevolent institution).

The employment of a person is included in the grant scheme if the employment meets all of the following conditions:

  • the person is employed in a new job on a full-time, part-time or casual basis, but not on a seasonal basis;
  • the employment commences between 1 July 2016 and 30 June 2018 inclusive;
  • the employment is maintained for a period of at least two years to be eligible for the full $10,000 or $4,000 grant, or a minimum of 12 months to be eligible for a partial grant

 

INNOVATION

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The Government have announced a $50 million Venture Capital Fund aimed at attracting venture capital and drawing business to relocate in South Australia. In addition, $10 million has been provided to a South Australian Early Commercialisation Fund to help start-ups at the pre-seed and seed stage of development to attract long-term investment.

The University of South Australia has been granted $7.5 million to establish a Future Industries Institute that is intended to help foster innovation and encourage collaboration between the university sector and potential new industries in South Australia.

 

TAXATION

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The State Government will extend the small business 50% payroll tax rebate for employers with payrolls between $600,000 and $1,000,000 (declining up to $1,200,000 payrolls). The extension will continue for the next four years to give employers additional confidence and certainty to hire.

From 2017/18 the State Government will introduce a 15% tax on net wagering revenue received from persons located in South Australia by all Australian based wagering operators.

 

INFRASTRUCTURE

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New in this budget is the $500 million that will be allocated to upgrade schools’ Science, Technology, Engineering, Mathematics (STEM) facilities. This comprises $250 million to refurbish STEM facilities in public schools and $250 million available to loan to private schools at government borrowing rates to also upgrade their facilities.

The 2016-17 Budget also confirms other previously announced infrastructure commitments. These include $35 million for the upgrade of Her Majesty’s Theatre, the recently announced $50 million extension of the tram network along North Terrace and upgrades to the Mt Gambier ($2.95 million) and Kangaroo Island airports ($9 million).

$500 000 has been allocated in the 2016-17 State Budget to further develop the business case for a new Contemporary Art Gallery in South Australia.

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