Carbon Pricing Tax Breaks The impact on your business Tim Bodey Principal WHK Ballarat.
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Transcript of Carbon Pricing Tax Breaks The impact on your business Tim Bodey Principal WHK Ballarat.
Overview of today’s session
• “Clean Energy Future” package
• Reporting requirements
(NGER)
• Income Tax breaks
(individuals and businesses)
• Families and Pension benefits
• Small/Medium businesses (SMEs) impacts
• What can we do now and into the future?
“Clean Energy Future” package
• Applies from 1 July 2012
• Starts out as a tax ($23p/T and indexed) for top 500 emitters
• Moves to Emissions Trading Scheme (1 July 2015)
National Greenhouse and Energy Reporting Act 2007
• Three year reporting program to determine to top 500 (or so) emitters
• Third and fourth tier thresholds apply to 30 June 2011 financial year
– Facility: 25,000kT greenhouse gas or 100Tj energy
– Corporate Group: 50,000kT greenhouse gas or 200Tj energy
• Some SMEs will have reporting requirements for the first time (register 31 August and report 31 October)
• Civil penalties for failing to register and possible personally liable for CEOs
Reviewing for NGER
• Now is the time
• Good data gathering procedures
• Record keeping processes
• Some Outcomes:
– Cost savings identified
– Streamlining of operations
– Better position to identify other opportunities
• www.climatechange.gov.au/reporting or 1800 018 831
The Tax Breaks (Individuals)
• Offsetting the “pain” of rising costs
• Changes to individual income tax rates, thresholds and rebates
Income Tax Rate (1/7/12) Tax Rate 1/7/15
Up to $18,200 0% %0 (↑ to $19,400)
$18,201 - $37,000 19% 19%
$37,201 - $80,000 32.5% 33%
$80,001 - $180,000 37% 37%
$180,000+ 45% 45%
• Low Income Earner Rebate reduces from $1,500 to $445
Impact on the family home
• Estimates suggest that approximately three million household will be adversely affected by the Carbon Tax
www.cleanenergyfuture.gov.au/helping-households/household-assistance-estimator/
• Puts the impact in $ and where some assistance from government is available
Pensions, allowances and family payments
Who? Singles Couples
Pensioners* Up to $338pa Up to $510pa
*Income threshold $50,000 $80,000
Families Part A - $110 per child Part B - $69 per child
Jobseekers 1.7% increase Single $218pf
Couple $390pf
Students 1.7% increase Single $177pf
• Small business (less than $2M turnover) - Asset write off from $5K to $6.5K
• Eligible industries - Energy efficient capital equipment grants (up to $25K); tender process
• Cost of acquiring “permits” tax deductible
• Issue of permits not subject to GST, but trading of carbon under ETS from 1 July 2015 will be
• Monitoring registration requirements
(possible increased administration)
Tax breaks and other considerations for SMEs
Impacts on a small – medium sized business
• Increased cost of energy, water and waste disposal
• Increased cost of food and beverage
• Increased cost of cleaning products, packaging
• Increased customer awareness
• Change of product mix to meet consumer demand changes
• Inability to pass on the price increases (maker/taker)
• Increased freight and cartage costs
(deferral of Carbon Tax on fuel until 1 July 2014)
• Costs to covert to energy efficient products
(mostly $3 spend for $1 recovery)
Business Energy Assessments
• Initial overview of your current usage
• Identify energy savings in your business
• Government initiative
• Concludes 31 December 2011
• Cost: $275 inc GST depending on size of business (turnover and staff numbers)
• Some businesses have identified up to 30% in savings in power costs
What can you do now?
• Review internal costings and energy usage
• Appoint a “green team” – staff really get involved
• Seek out government funding opportunities:
– AusIndustry
– Regional Development Victoria
– www.grantslink.gov.au
– Clean Technology Programs ($800M/$2Bn):
• (www.innovation.gov.au/Industry/CleanEnergyFuture/Pages/CleanTechnologyProgram.aspx)
Other Government Grants of interest
• Enterprise Connect (www.enterpriseconnect.gov.au)
Business review / Advisor services
• Grow your business (www.business.vic.gov.au)
Strategic Review / Business Development Plan / Mentoring
• R&D Tax Incentive (new rules apply 1 July 2011)