Has the centre piece of this year’s Federal Budget, $5.5b worth of initiatives aimed at boosting the growth of the small business sector really worked?
From our perspective we witnessed a sound increase in business sentiment following the Federal Budget. A far cry from the aftermath of last year’s Budget.
Did this sentiment translate into action?
Yes, we certainly experienced good equipment finance activity in the lead up to 30 June as many businesses took advantage of the new tax incentives to purchase capital items each up to $20,000. This heightened level activity prior to 30 June has however led to somewhat of a vacuum in July and August most likely due to businesses bringing forward some capex spending into FY 2015.
The challenge we see is now not so much the tax incentives for small business but the necessity for consumption growth to kick start so as create purchase demand/sales for businesses which will in turn lead them to make more capital purchases.