So what’s happened.

The much anticipated Henry Tax Review was announced, the 2010 Federal and State Budgets were brought down and there was a change of the guard in Canberra.

Both Federal and State budgets were conservative in approach with an emphasis on keeping the Australian economy moving forward.

Some of the highlights in the Federal Budget included:

• 50% tax discount on interest income for the first $1,000 earned,
• 100% tax write off for small business on plant and equipment up to $5,000
• Company tax rates to fall
• Superannuation rates to rise for compulsory employee superannuation from 9% to 12%.

The majority of these changes won’t take effect until 2011 and beyond, so the impact for the majority of business owners and taxpayers was negligible at this time.

In terms of politics in Canberra, the new Prime Minister should announce an election date soon. For the best part that will mean an election campaign – but we expect that it will be full of promises from both sides.

So what are the influencing factors right now and in the short term? I believe we will continue to see slower times for small business over the coming year. Big business that includes the mining sector is still ‘powering’ ahead particularly in WA and Queensland, which of course has some flow-on to local Hunter small business operators.

Money is still tight with the major four big banks, so business owners need to remain focused on daily cash flow.

I would suggest constantly reviewing stock levels, weekly and monthly costs and be active in collecting outstanding customer accounts. Ensure that you are positive about what is happening in your business, and think seriously about maintaining your current spend in marketing and promotion. Use those dollars effectively to promote your point of difference – it’s what will help you position your business above your competitors.

A little closer to home Taggart Partners relocated to Hamilton on 1 June. It is a nice change of address and scenery for the team and our clients. We are still committed to providing the best possible accounting and tax advice for our clients and small business in the region.

Please drop in and say hello. We would love to show you around our new space.

Ross Taggart