Change to asset write off no use to farmers says MP

Federal Member for Parkes Mark Coulton has warned that Labor’s changes to the Instant Asset Write-off have hamstrung its ability to assist many businesses across the Parkes electorate, particularly those in the agricultural sector.

Under the scheme, eligible businesses can claim an immediate deduction for the business portion of the cost of an asset in the year the asset is first used or installed ready for use.

But Mr Coulton said the Labor government has lowered the instant asset write-off to the lowest level since 2019 with businesses now only able to claim assets up to $20,000 in value – down from $150,000 under the previous Coalition government.

“The Instant Asset Write-off is a wonderful scheme in that it directly supports and encourages economic growth,” Mr Coulton said.

“While I’m glad to see it wasn’t completely cut in the recent Federal Budget, it has been so reduced that I’m worried about the ramifications for businesses across the Parkes electorate who in the past could rely on this support. 

“The Instant Asset Write-off used to be a great economic stimulus, meaning businesses could get a tax write-off on certain items they purchased straight away, driving their ability to expand and feeding back into local economies. 

“In farming areas, these tax write-offs meant agriculture businesses could purchase assets like heavy machinery or drought mitigation infrastructure and that money spent would typically go to locally based suppliers and contractors.

“The new limits on the Instant Asset Write-off have minimised its effectiveness, because a lot of the work done in agriculture needs those higher thresholds to remain in place. Many businesses across the electorate of Parkes will now be ineligible to access this assistance, or won’t find it worthwhile given that many items of farm machinery for example cost beyond $20,000.

“I think this is another example of the importance of understanding how our local economies work, particularly in agriculture-based areas – something Labor just doesn’t seem to have a handle on. 

“The Instant Asset Write-off was a huge support for our farmers and regional businesses – those we rely on across the country for our food and fibre – and also those most vulnerable to the effects of natural disasters like droughts and flooding. 

“If Labor saw the Instant Asset Write-off as wasteful I challenge them to give me a better support mechanism to provide assistance to our farming communities and their economies.

“This cut is no good for the Parkes electorate, and like so many Labor policies needs some serious rethinking,” Mr Coulton said.

“I have said it many times: regional Australia and working Australians are where our economic strength lies, and Labor needs to recognise this,” Mr Coulton said.