• inprevious yearbefore the current year the aggregated turnover of the business was less than $2 million
• the aggregated turnover for the current year is likely to be less than $2 million. [31]

Small business entities have access to a number of existing tax concessions, including capital gains tax concessions and simplified depreciation arrangements.

Under existing arrangements, a small business entity can choose to use simplified depreciation arrangements which operate so that:

• assets costing up to $1,000 can be deducted in the income year in which they are purchased
• assets costing more than $1,000 can be included in a ‘general small business pool’ which has depreciation applied at a rate of 15 per cent for the first year and 30 per cent in the later years, rather than be individually depreciated. When the value of the pool is less than the $1,000 threshold, the entire amount can be deducted in the income year
• a taxpayer who chooses to apply these simplified arrangements in one income year and does not choose it in a later income year cannot choose to use these simplified arrangements for a period of five years (this is called the five year lock out rule).[32]

The benefit to eligible small businesses of these arrangements is the simplification provided by the pooling of assets which are depreciated at the fixed 30 per cent rate as well as the $1,000 representing a significantly higher amount than the $300 instant write-off amount that applies generally.[33]

Changes to depreciation thresholds

The $1,000 threshold has applied from 1 January 2014, following the passage of legislation to repeal the Minerals Resource Rent Tax (MRRT).[34]

Between 1 July 2012 and 30 December 2013 a higher threshold of $6,500 applied. This $6,500 threshold was implemented by the Gillard Government, and was an outcome of the enactment of both the MRRT (increase to $5,000) and Carbon Price Mechanism (‘carbon tax’) (further increase to $6,500).[35]

In the lead-up to the 2013 Federal election, the Coalition made a commitment to repeal both the MRRT and carbon tax. This would necessitate a corresponding reduction of the $6,500 threshold to $1,000.[36] In supporting the reduction of the threshold to $1,000, the Treasurer’s argument was largely based on the revenue cost of the policy being linked to the lack of revenue raised by the MRRT, rather than the merits of the higher threshold as a stand alone policy:

There are expenditures that the government announced against the mining tax that the coalition wishes it could keep, but we cannot keep spending initiatives that are funded by borrowed money. It is unsustainable.

So schedule 3 of the bill amends the instant asset write-off threshold provisions for small business entities.

The threshold value of a depreciating asset for the purposes of instant asset write-off provisions was increased from $1,000 to $6,500 as part of the introduction of both the mining tax and the carbon tax package.

We seek to reduce this back to $1,000 from 1 January 2014. I know it is hard. I want to say it is hard. The Minister for Small Business knows it is hard. We know it is hard, but these are the hard decisions that have to be made because the people of Australia cannot afford to have initiatives that involve a cost to the budget that is being funded by borrowing money.[37]

Prior to the increase from 1 July 2012, the threshold had been set at $1,000 since 1 July 2001, when depreciation arrangements for small business were simplified as an outcome of the Review of Business Taxation (known as the Ralph Review).[38]

In 2010, the report of Australia’s Future Tax System (known as the Henry Tax Review) recommended an increase in the threshold to $10,000.[39] This recommendation was largely based on the perceived advantages of simplifying arrangements for these entities and providing them with a cash flow benefit.[40]

Accelerated depreciation for primary producers

Accelerated depreciation for primary producers for water facilities and horticultural plants has been allowed for some time. Initially capital expenditure on water infrastructure could be deducted over a period of ten years.[41] In 1980, the Fraser Government enabled expenditure on water infrastructure to be immediately deductable in full.[42] One purpose of this was to encourage primary producers to increase their ability to withstand drought.[43]

This accelerated depreciation was retained until 1996–97 when the three year depreciation arrangements under the ITAA 1997 commenced.[44]

The enactment of the Taxation Laws Amendment (No. 4) Act 1995 enabled horticultural plants to depreciate, initially either immediately (if the expected life of the plant is less than three years), or over the life of the plant.[45] The purpose of this measure was to give expenditure on horticultural plants comparable tax treatment to capital expenditure in other industries.[46] The measure was part of the Government’s response to the Horticultural Task Force report.[47]

In the 2015–16 Budget the Government announced measures that would enable primary producers to deduct expenditure on water facilities and fencing on an accelerated basis from 1 July 2016.[48] It also included measures that would enable expenditure on fodder storage assets to be deducted over three years.[49]

Unlike the proposed small business measures which limit deductibility to assets purchased before 30 June 2017 and to assets costing less than $20,000, no time limit or maximum cost is provided for in the primary producer measures. Like the 1980 amendment these measures are also designed to encourage primary producers to increase their ability to withstand drought and complement the other drought assistance measures outlined in the 2015–16 Budget.[50]

Previously, deductions for fencing and fodder storage assets could be made over the ‘effective life’ of those assets. The effective life of a depreciating asset is defined as the period an asset can be used to produce an income.[51] According to the 2015–16 Budget this is up to 30 years for fences and up to 50 years for fodder storage assets.[52]

The primary producer measures were initially due to commence on 1 July 2016.[53] On 27 May 2015, however, it was announced that they would commence retrospectively, like the other small business measures, at 7:30 pm on 12 May 2015.[54] This was apparently due to pressure from the agricultural sector and discussions with the Minister for Agriculture.[55]

The measures are in line with policy ideas which were mooted in the Government’s 2014 Agricultural Competitiveness Green Paper.[56] The matters raised by stakeholders in the Green Paper included that the value of assets such as water infrastructure and feed storage be fully deductible.[57]

These primary producer measures are available only to primary producers. Primary producers are, however, eligible for the small business measures generally, provided they have a turnover of less than $2 million.

Committee consideration

At the time of writing this Bills Digest, the Bill had not been referred to a Committee for inquiry and report. In addition, neither the Senate Standing Committee for the Scrutiny of Bills nor the Parliamentary Joint Committee on Human Rights had commented on the Bill.

Statement of Compatibility with Human Rights

As required under Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 (Cth), the Government has assessed the Bill’s compatibility with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of that Act. The Government considers that the Bill is compatible.[58]

Policy position of non-government parties/independents

The Bill was passed in the House of Representatives on 4 June 2015.

In his budget reply speech on 14 May 2015, the Leader of the Opposition, Bill Shorten, indicated that the Australian Labor Party (ALP) would support the small business measures announced in the 2015–16 Budget.[59]

The Australian Greens (the Greens) welcomed the reinstatement of a higher threshold but were critical of the limited period in which it applied, noting that ‘[t]he tax-deduction for asset purchases will only last two-years, thus providing a sugar hit for the sector and broader economy but no long-term ongoing support for small business’.[60] The Greens 2013 election policy proposed an increase from the then $6,500 threshold for the instant asset write-off to $10,000.[61]

Position of major interest groups

Small business accelerated depreciation

Business groups have generally supported lifting the instant asset write-off threshold from $1,000 to $20,000.

In its 2015–16 pre-budget submission, the Australian Chamber of Commerce and Industry (ACCI) supported the implementation of the Henry Tax Review recommendation to increase the threshold for assets that small businesses can immediately write-off to $10,000.[62] Following the budget announcement of the increase to $20,000 as well as the other small business-related measures, the ACCI noted:

It is encouraging that the government is looking after those 1.7 million unincorporated small businesses, including tradies, sole operators and partnerships, with other support. Making it easier for small businesses to claim tax deductions for their expenses will make it easier for small businesses to invest.

These deductions are particular [sic] powerful when combined with recently announced measures to help new businesses, including allowing new start-ups to immediately deduct professional costs, such as for legal and accounting services, as well as streamlined company registration and removing barriers to crowd-sourced equity funding.[63]

Prior to the 2015–16 Budget, the Council of Small Business Organisations of Australia (COSBOA) advocated for an ‘investment allowance’ that would provide immediate deductibility up to 50 per cent of the cost of eligible assets installed and ready for use up to a cost of $2 million between 1 July 2015 and 30 June 2018 for businesses with a turnover of less than $5 million.[64] Following the release of the Budget, the CEO of COSBOA welcomed the small business package:

The budget inclusions for small business have been designed to boost confidence, boost cash flow and boost the economy, an economy that has always been based upon the foundation of small business people.

... the immediate deductibility for assets purchased up to $20k is as unexpected as it is welcomed. The 5% tax discount for unincorporated small business is another highlight of the budget.  There are many more highlights in this budget which provides the lowest tax rate for small business since 1967. The government has promised something special for small business and have delivered on that promise.[65]

Chartered Accountants Australia and New Zealand welcomed the budget measures for small business, noting that:

The small business instant asset write-off is just what the doctor ordered and increased spending should follow. It’s a very practical way to help these businesses work smarter with modern equipment and technology. The cost of setting up a business will be reduced with legal and accounting advice being written off and the process to register a business simplified. This should boost innovative start-ups and create yet more energy in the engine room of the economy.[66]

Primary producer accelerated depreciation

Farmers groups have generally supported the proposed accelerated depreciation measures for primary producers.[67] The National Farmers’ Federation (NFF) noted that:

The [NFF] welcomes the Federal Government announcement on bringing forward [the] introduction of accelerated depreciation of fodder, fencing and water assets to the night of the Federal Budget. They have responded quickly to the feedback received and NFF congratulates them.

The decision to bring the commencement date forward will be welcome news for farmers and small businesses across the country - particularly those struggling with drought or preparing for El Niño conditions forecast for Eastern Australia.[68]

Financial implications

The Explanatory Memorandum states that the financial impact of the measures proposed by the Bill over the four years to 2018–19 is almost $2.2 billion (Table 1).

Table 1 Financial impact of accelerated depreciation arrangements for small business entities and primary producers as proposed by the Bill ($ million)

Source: Explanatory Memorandum, Tax Laws Amendment (Small Business Measures No. 2) Bill 2015, pp. 3 and 5, accessed 10 June 2015.

Key issues and provisions

Schedule 1—accelerated depreciation for small business entities

As previously noted, a small business entity can choose to use simplified depreciation arrangements which operate so that:

• assets costing up to $1,000 can be deducted in the income year in which they are purchased
• assets costing more than $1,000 can be included in a ‘general small business pool’ which has depreciation applied at a rate of 15 per cent for the first year and 30 per cent in the later years, rather than be individually depreciated. When the value of the pool is less than the $1,000 threshold, the entire amount can be deducted in the income year
• a taxpayer who chooses to apply these simplified arrangements in one income year and does not choose it in a later income year cannot choose to use these simplified arrangements for a period of five years.[69]

As the measures will apply for a limited time period, item 9 of Schedule 1 to the Bill inserts proposed section 328–180 into the Transitional Provisions Act. The section introduces two key definitions. The first is 2015 budget time which means 7.30 pm, by legal time in the Australian Capital Territory, on 12 May 2015. The second is increased access year which means an income year that ends on or after 12 May 2015 and on or before 30 June 2017.

Proposed section 328-180 applies to:

• exempt an entity from the five year lockout rule in an increased access year thereby allowing the entity to switch to the small business pool arrangements even if the entity has opted out of these arrangements
• increase the threshold for writing off assets from $1,000 to $20,000 if the assets were acquired after the 2015 budget time and the asset was first used, or first installed, for a taxable purpose at or after the 2015 budget time and on or before 30 June 2017 and
• increase the low value pool from $1,000 to $20,000.

Items 1–8 of Schedule 1 to the Bill insert notes at the end of relevant paragraphs in Subdivision 328D of the ITAA 1997 to specify that the threshold is $20,000 for income years ending on or after 12 May 2015 and on 30 June 2017 and to cross reference the relevant sections that are inserted into the Transitional Provisions Act by item 9 of this Bill (discussed above).

Key issue—a time limited or permanent arrangement?

The application of a fixed period in which the higher $20,000 threshold is available (on or after 12 May 2015 to 30 June 2017) compared to the Gillard Labor Government’s ongoing $6,500 threshold is a key point of difference between these policies.

There is no information available to examine the effectiveness of the increase in the threshold from $1,000 to $6,500 on a permanent basis. The Explanatory Memorandum states that:

Data are not yet available to accurately assess a previous version of this policy. Even when they are, this kind of analysis can be difficult.[70]

Time-limited accelerated depreciation arrangements have been implemented in the United States on a number of occasions. A 2008 study of ‘bonus depreciation’ arrangements that applied for a limited time in the early 2000’s found that the arrangement ‘appears to have had a powerful effect on the composition of investment. Capital that benefited substantially from the policy saw sharp increases in investment’.[71]

However, a 2014 study of such arrangements by the Congressional Research Service (which by that time considered studies examining the reintroduction and continuation of these ‘temporary’ measures) noted that the policy ‘did not appear to be very effective in providing short-term economic stimulus compared to alternatives’.[72] This conclusion included consideration of the earlier study as well as additional information, including a study of several surveys of firms, which showed that between two-thirds and more than 90 per cent of respondents indicated bonus depreciation had no effect on the timing of investment spending.[73]

Schedule 2—accelerated depreciation for primary producers

The items in Schedule 2 to the Bill amend the ITAA 1997.

A person carries on primary production business if the person carries on a business doing any of the following:

• cultivating or propagating plants, fungi or their products or parts (including seeds, spores, bulbs and similar things), in any physical environment
• maintaining animals for the purpose of selling them or their bodily produce (including natural increase)
• manufacturing dairy produce from raw material that you produced
• conducting operations relating directly to taking or catching fish, turtles, dugong, bêche-de-mer, crustaceans or aquatic molluscs
• conducting operations relating directly to taking or culturing pearls or pearl shell
• planting or tending trees in a plantation or forest that are intended to be felled
• felling trees in a plantation or forest
• transporting trees, or parts of trees, that you felled in a plantation or forest to the place where they are first to be milled or processed or from which they are to be transported to the place where they are first to be milled or processed.[74]

Item 2 amends item 1.5 in the table at section 40-10 of the ITAA 1997 to indicate that a primary producer can deduct amounts for capital expenditure on:

• water facilities immediately (rather than over three income years as currently)
• fodder storage assets over three income years and
• fencing assets immediately.

Item 12 of Schedule 2 to the Bill inserts the definitions of fodder storage asset and fencing asset into section 40‑520 of the ITAA 1997 so that:

• a fodder storage asset is an asset or a structural improvement, or a repair of a capital nature, or an alteration, addition or extension, to an asset or a structural improvement, that is primarily and principally for the purpose of storing fodder and
• a fencing asset is an asset or a structural improvement that is a fence or a repair of a capital nature, or an alteration, addition or extension, to a fence.

The term water facilities as set out in existing section 40-520 of the ITAA 1997 means:

• plant or a structural improvement, or a repair of a capital nature, or an alteration, addition or extension, to plant or a structural improvement, that is primarily and principally for the purpose of conserving or conveying water or
• a structural improvement, or a repair of a capital nature, or an alteration, addition or extension, to a structural improvement, that is reasonably incidental to conserving or conveying water.

Item 16 of Schedule 2 of the Bill repeals and replaces section 40-540 of the ITAA 1997 so that a water facility is taken to decline in value by the full amount of the expenditure incurred on the construction, manufacture, installation or acquisition of the water facility in the income year in which the expenditure was incurred.

Item 17 of Schedule 2 of the Bill inserts proposed section 40-548 into the ITAA 1997. Proposed section 40-548 provides that the decline in value for a fodder storage asset is assessed over three years from the income year in which the capital expenditure was incurred on the construction, manufacture, installation or acquisition of the fodder storage asset. Importantly, item 7 of Schedule 2 of the Bill inserts proposed paragraph 40-515(3)(c) into the ITAA 1997 to apply the condition that the accelerated deduction for fodder storage assets cannot be more than the amount of the capital expenditure incurred on the asset.

Item 17 also inserts proposed section 40-551 into the ITAA 1997 so that fencing assets are taken to decline in value by the full amount of the expenditure incurred on the construction, manufacture, installation or acquisition of the fencing asset in the income year in which the expenditure was incurred. Item 7 of Schedule 2 of the Bill inserts proposed paragraph 40-515(3)(d) into the ITAA 1997 to apply the condition that the accelerated deduction for fencing assets cannot be more than the amount of the capital expenditure incurred on the asset.

Item 21 operates so that the amendments contained in Schedule 2 apply to assets that an entity starts to hold or to expenditure that an entity incurs after 7:30 pm, by legal time in the Australian Capital Territory on 12 May 2015.

Concluding comments

Accelerated depreciation arrangements have been used for a number of reasons in the tax system. The proposed measures for small business and primary producers are largely designed to provide incentives to invest and stimulate economic activity, as well as to simplify arrangements to some degree.

Despite these positive features, accelerated depreciation arrangements can have a distortionary economic impact on the timing of investment and on the allocation of resources across the economy away from their most efficient use.

Members, Senators and Parliamentary staff can obtain further information from the Parliamentary Library on (02) 6277 2500.

[1].         Income Tax Assessment Act 1997, accessed 10 June 2015.

[2].         Income Tax (Transitional Provisions) Act 1997, accessed 10 June 2015.

[3].         Australian Government, Budget measures: budget paper no. 2: 2015–16, pp. 14 and 19, accessed 9 June 2015.

[4].         T Abbott (Prime Minister), J Hockey (Treasurer) and B Billson (Minister for Small Business), Growing jobs and small business package to help small businesses invest more, grow more, and employ more, joint media release, 12 May 2015, accessed 2 June 2015.

[5].         See Parliament of Australia, ‘Tax Laws Amendment (Small Business Measures No. 1) Bill 2015 homepage’, Australian Parliament website for the Bill, the relevant Explanatory Memorandum and the Bills Digest.

[6].         T Abbott (Prime Minister), J Hockey (Treasurer) and B Billson (Minister for Small Business), op. cit.; Australian Government, Budget 2015: growing jobs and small business, 2015, p. 2, accessed 2 June 2015.

[7].         Australian Government, Budget measures: budget paper no. 2: 2015–16, op. cit., pp. 14 and 19.

[8].         H Sanders and R Weiss, ‘Analysis of the economic and tax depreciation of structures’, Tax Management Real Estate Journal, 16(12), 2000, pp. 343–355, accessed 4 June 2015.

[9].         Ibid., p. 347.

[10].      Income Tax Assessment Act 1997, section 40-1.

[11].      Income Tax Assessment Act 1997, section 40-10.

[12].      Income Tax Assessment Act 1997, section 40–95, accessed 4 June 2015. The ITAAA 1997 uses the term ‘capital allowances’ to describe depreciation in some parts.

[13].      JT Ralph AO, ‘A platform for consultation: discussion paper 2: building on a strong foundation’, volume 1, February 1999, paragraph 2.1, p. 117, accessed 10 June 2015.

[14].      Ibid., paragraph 2.2.

[15].      Ibid., paragraph 2.4.

[16].      M Benge, ‘Taxes and investment decisions’, in J Head (ed), Fightback: an economic assessment, papers from a conference organised by the public sector management institute, Monash University, Australian Tax Research Foundation, 1993, pp. 171–192.

[17].      JT Ralph AO, ‘A platform for consultation’, op. cit., paragraph 2.9, p. 118.

[18].      Ibid., paragraph 2.14, p. 119.

[19].      Y Margalioth, ‘Not a panacea for economic growth’, Virginia Tax Review, 26(3), 2007, pp. 493–518 at p. 509, accessed 7 June 2015.

[20].      Ibid.

[21].      Organisation for Economic Cooperation and Development (OECD), Taxation of SMEs: key issues and policy considerations, OECD Tax Policy Studies, 18, p. 85 and 94, accessed 1 June 2015.

[22].      Treasury, Tax expenditures statement 2014, January 2015, tax expenditure B65, p. 55, accessed 4 June 2015.

[23].      Ibid., tax expenditure B68, p. 56.

[24].      Ibid., tax expenditure B75, p. 59.

[25].      Ibid., tax expenditure B72, p. 57.

[26].      Ibid., tax expenditure B73, p.58.

[27].      B Billson (Minister for Small Business), ‘Second reading speech: Tax Laws Amendment (Small Business Measures No. 2) Bill 2015’, House of Representatives, Debates, 28 May 2015, p. 7, accessed 10 June 2015.

[28].      Explanatory Memorandum, Tax Laws Amendment (Small Business Measures No. 2) Bill 2015, pp. 22–32 and pp. 44–61, accessed 10 June 2015.

[29].      Ibid.

[30].      Ibid., p. 44.

[31].      Income Tax Assessment Act 1997, subdivision 328-C, accessed 1 June 2015.

[32].      Income Tax Assessment Act 1997, subdivision 328‑D.

[33].      Income Tax Assessment Act 1997, paragraph 40–80(2)(a).

[34].      Minerals Resource Rent Tax Repeal and Other Measures Act 2014, Schedule 3, accessed 7 June 2015.

[35].      Tax Laws Amendment (Stronger, Fairer, Simpler and Other Measures) Act 2012, Schedule 2, accessed 9 June 2015.

[36].      Liberal National Coalition, The Coalition’s policy for resources and energy, Coalition policy document, Election 2013, p. 4, accessed 7 June 2015; Liberal National Coalition, Fiscal budget impact of Federal Coalition policies, Coalition policy document, Election 2013, p. 1, accessed 7 June 2015.

[37].      J Hockey (Treasurer), ‘Second reading speech: Minerals Resource Rent Tax Repeal and Other Measures Bill 2013’, House of Representatives, Debates, 13 November 2013, p. 88, accessed 7 June 2015.

[38].      Taxation Laws Amendment Act (No. 5) 2002, Schedule 3, accessed 10 June 2015.

[39].      K Henry, Australia’s future tax system: report to the Treasurer, Part Two detailed analysis, volume 1 of 2, December 2009, p. 173, accessed 1 June 2015.

[40].      Ibid.

[41].      S Carrick (Minister for National Development and Energy), ‘Second reading speech: Income Tax Assessment Amendment (No. 3) Bill 1980’, Senate, Debates, 16 May 1980, p. 1, accessed 1 June 2015.

[42].      Income Tax Assessment Amendment Act (No. 3) 1980, accessed 2 June 2015.

[43].      Income Tax Assessment Amendment Bill (No. 3) 1980, Bills digest, 91, Parliamentary Library, Canberra, 1980, accessed 2 June 2015.

[44].      Tax Law Improvement Act 1997, Schedule 1, accessed 12 June 2015.

[45].      Taxation Laws Amendment Act (No. 4) 1995, accessed 2 June 2015.

[46].      G Gear (Assistant Treasurer), ‘Taxation Laws Amendment Bill (No. 4) 1995, Income Tax (Franking Deficit) Amendment Bill 1995, Income Tax (Deficit Deferral) Amendment Bill 1995’, media release, 28 September 1995, accessed 2 June 2015.

[47].      C Field, Taxation Laws Amendment Bill (No. 4) 1995, Bills digest, 65, 1995–96, Parliamentary Library, Canberra, 1995, accessed 2 June 2015.

[48].      Budget measures: budget paper no. 2: 2015–16, op. cit., p. 14.

[49].      Ibid.

[50].      For an overview of the other drought assistance measures in the 2015–16 Budget see R Dossor, ‘Drought measures’, Research paper, Budget review 2015–16, Parliamentary Library, Canberra 2015, accessed 2 June 2015.

[51].      Income Tax Assessment Act 1997, section 40-10.

[52].      Budget measures: budget paper no. 2: 2015–16, op. cit.

[53].      Ibid.

[54].      J Hockey (Treasurer), B Joyce (Minister for Agriculture) and B Billson (Minister for Small Business), Depreciation for farmers brought forward, joint media release, 27 May 2015, accessed 10 June 2015.

[55].     J Owens, ‘Farm tax write-offs brought forward by a year’, The Australian, (online edition), 27 May 2015, accessed 10 June 2015.

[56].      Australian Government, Agricultural competitiveness green paper, 2014, p. 69, accessed 9 June 2015.

[57].      Ibid.

[58].      The Statements of Compatibility with Human Rights can be found at pages 21 and 43 of the Explanatory Memorandum to the Bill.

[59].      B Shorten, ‘Second reading speech: Appropriation Bill (No. 1) 2015-2016’, House of Representatives Debates, 14 May 2015, p. 95, accessed 3 June 2015.

[60].      P Whish-Wilson, Small business package puts back what the Government took away, media release, 13 May 2015, accessed 1 June 2015.

[61].      Australian Greens, Standing up for small business: lower tax and a stronger voice, Australian Greens policy document, August 2013, p. 1, accessed 1 June 2015.

[62].      Australian Chamber of Commerce and Industry (ACCI), ACCI pre-budget submission 2015–16, February 2015, p. 3, accessed 9 June 2015.

[63].      Australian Chamber of Commerce and Industry, Small business welcomes support in Budget, media release, 12 May 2015, accessed 9 June 2015.

[64].      P Strong and D Gandolfo, ‘Why small business needs an investment allowance’, Smartcompany.com.au, 30 April 2015, accessed 9 June 2015.

[65].      Council of Small Business Organisations of Australia, Budget extraordinaire shows respect for people in business, 12 May 2015, accessed 3 June 2015.

[66].      Chartered Accountants Australia and New Zealand, Response from Chartered Accountants Australia and New Zealand about the Federal Budget, media release, 12 May 2015, accessed 3 June 2015.

[67].      Canegrowers Australia, Budget 2015: canegrowers response, media release, 13 May 2015, accessed 9 June 2015; Australian Dairy Farmers, ADF looks forward to release of agricultural competitiveness white paper, media release, 13 May 2015, accessed 9 June 2015.

[68].      National Farmers’ Federation, NFF welcomes depreciation announcement, media release, 27 May 2015, accessed 9 June 2015.

[69].      Income Tax Assessment Act 1997, subdivision 328-D, accessed 10 June 2015.

[70].      Explanatory Memorandum, Tax Laws Amendment (Small Business Measures No. 2) Bill 2015, p. 30.

[71].      C House and M Shapiro, ‘Temporary investment tax incentives: theory with evidence from bonus depreciation’, The American Economic Review, 98(3), 2008, p. 762. The ‘bonus depreciation’ policy examined involved an immediate deduction of 30 per cent (later increased to 50 per cent) for certain types of qualified capital goods with the remaining 70 per cent under standard depreciation schedules for investments made prior to the end of 2005.

[72].      J Gravelle, ‘Bonus depreciation: economic and budgetary issues’, Congressional Research Service, 7 July 2014, p. 6, accessed 9 June 2015.

[73].      Ibid.

[74].      Income Tax Assessment Act 1997, section 995-1.

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