PAYROLL TAX RELIEF A STRONG PLAN FOR REAL CHANGE 1

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1 PAYROLL TAX RELIEF A STRONG PLAN FOR REAL CHANGE 1

2 We re ready. Over the last four years, we ve been working hard developing our vision for the future of South Australia. Not just policies, but a series of achievable milestones that have been crafted for the long-term benefit of our state. Our focus will be MORE JOBS. LOWER COSTS. BETTER SERVICES. We ve got a strong plan for real change. A STRONG PLAN FOR REAL CHANGE 2

3 MORE JOBS. LOWER COSTS. BETTER SERVICES. WHAT WE LL DO If elected in March 2018, a Marshall Liberal Government will scrap payroll tax for all small businesses in South Australia. We will do this by exempting businesses with taxable payrolls of up to $1.5 million from paying any payroll tax. We will introduce the measure in our first budget so that small businesses can begin to benefit from 1 January The legislative change required will be to exempt businesses with payrolls between the existing threshold of $600,000 and $1,500,000 from paying any payroll tax. By providing this exemption, a Marshall Liberal Government will remove a major disincentive to businesses creating more jobs and employing more people, as well as making South Australia a much more attractive place to invest in and grow businesses. This measure will benefit thousands of small businesses with payrolls of up to $1.5 million, as well as giving confidence to the more than 130,000 micro-businesses and sole traders who can create more jobs knowing that they won t be hit with an extra tax as soon as they employ additional South Australians. This reform will remove the payroll tax burden for businesses employing an average 25 employees, unleashing the growth potential of many of the fastest growing enterprises in our economy. Our reform will reduce the payroll tax paid by small and some medium businesses by an estimated $44.5 million per year, incentivising them to create thousands of extra jobs for South Australians. Importantly, this reform will deliver broad-based change to the state s economic settings by improving our competitiveness and investment attractiveness, rather than attempting to pick winners amongst individual businesses. This is a strong statement, backed by real action, that a Marshall Liberal Government will provide support to our small businesses across the board. A STRONG PLAN FOR REAL CHANGE 3

4 MORE JOBS. LOWER COSTS. BETTER SERVICES. WHY WE RE DOING IT South Australian businesses are doing it tough at the moment, operating under some of the highest cost structures in Australia, and in some instances the world. In addition to punishing utility prices, the Weatherill Labor Government has spent the last 16 years crafting a stifling state tax regime that rips $4.5 billion from South Australian employers and consumers every single year. Labor has repeatedly used state taxation to grow the size of government and pursue its socialist agenda, at the expense of new opportunities for jobs growth and investment by private enterprise. This is evident in the $90 million a year increase in ESL bills paid by households and businesses, $20 million a year increase in the Solid Waste Levy and the new $11 million a year foreign investor tax. The annual $4.5 billion tax burden would have been made even worse had the Liberals not opposed the Weatherill Labor Government s repeated attempts to impose even higher taxes through a $100 million a year State Bank Tax, a $30 million a year Car Park Tax, and increasing the GST by broadening its base and hiking the rate up by 50 per cent. South Australia s $1.2 billion annual payroll tax take remains one of the most uncompetitive in the nation. The tax-free threshold on payrolls is the lowest in the nation under Labor, along with a complex regime for calculating liabilities. In an economy that is reliant on small and medium businesses, we cannot expect employers to grow and create more jobs if government is constantly adding to their cost base, and especially to the cost of employing South Australians. Many small businesses are discouraged from employing an extra person if it means incurring extra tax liability, and enduring the additional compliance costs that go along with it. At a time when South Australia needs more jobs, greater investment and stronger growth, an uncompetitive payroll tax regime only serves to undermine confidence and make the situation harder for business to create jobs and employ more South Australians. A STRONG PLAN FOR REAL CHANGE 4

5 STEVEN MARSHALL MP State Liberal Leader Phone: A STRONG PLAN FOR REAL CHANGE 5