11 hours ago
Thousands of Victorian businesses to receive payroll tax relief next month
Tens of thousands of Victorian businesses are expected to pay less in tax, with payroll tax changes to be introduced next month.
The change will see the payroll tax-free threshold rise from $900,000 to $1 million on July 1.
Premier Jacinta Allan said it was expected that 28,000 businesses would be paying less, with an additional 6,000 businesses now exempt from the tax altogether.
The changes to payroll tax have been earmarked since 2023, with the government raising the threshold first from $750,000 to $900,000 in July last year.
The move comes amid forecasts of record high levels of debt, with the premier conceding there would be some recalculations required.
"Yes, this does require an adjustment to our budget and our revenue, but this is an investment in business and jobs and growth," Ms Allan said.
Payroll tax was projected to form the biggest source of revenue for the government in the 2025/26 financial year.
Treasurer Jaclyn Symes said the affected businesses would save up to $14,500 each.
"That has obviously been something that we've factored in over the forwards [projections]," Ms Symes said.
Along with the changes to payroll tax, the government will also cut red tape in the planning system.
On July 1, the government will scrap the requirement for businesses to apply for planning permits for liquor licensing.
Business Wodonga chief executive Graham Jenkin said the permanent changes to licensing requirements had been expected for months but it would be great for regional restaurants and cafes.
"This is great because Victoria really has more red tape than any other state government in in Australia, so anything that can reduce red tape which is an obstacle to doing business," Mr Jenkin said.
"Business owners don't want to be spending all of their time doing reports."
But Mr Jenkin said any changes to payroll tax would make no difference to small businesses who were still recovering from COVID.
He said a further range of targeted measures needed to be implemented to help those who were running small-to-medium businesses in Victoria.
"A lot of very small businesses will of course see no benefit from it," he said.
"It could be a subsidy of council rates, [it] could be less of the Victorian emergency services and volunteers fund levy that small businesses will be forced to pay."
Mr Jenkin said more training and development workshops in regional areas and more work in mental health for business owners struggling financially were also essential.
