Clean Energy Future

The impact of a carbon price on small business

A carbon price will create new job opportunities across a range of industries. For example, over time, renewable energy will grow from 10 to 40 per cent of the generation mix by 2050. This kind of growth will create spin-off opportunities for a whole range of small entrepreneurs and business owners.

There may be some indirect cost impacts on small businesses, such as higher electricity bills, as a result of bigger companies passing on the costs of the carbon price. But these costs are projected to be modest. Prices of some consumer goods and services will rise, but the Government’s household assistance package will ensure millions of households will be better off compared to their average price impact, so customers will still be able to support small businesses.

Measures to assist small business adjust to a carbon price

The Government recognises the contribution of small business to Australia’s economy. Small businesses comprise about 96 per cent of all businesses and represent about 35 per cent of industry value added and provide 47 per cent of the nation’s jobs.

Small business operators often can’t spare the time or don’t have the financial resources to focus on matters outside their core business. That is why the Government will help small businesses get the support they need to stay competitive under a carbon price and share the benefits of Australia’s clean energy future.

Increasing the business asset write-off

For businesses with an aggregated turnover of less than $2 million a year, the small business instant asset write-off threshold will be increased from $5,000 to $6,500 for depreciable assets from the 2012-13 income year.

The existing instant asset write-off improves business cash flow by providing an immediate income tax deduction for the cost of eligible assets. Increasing the amount businesses can write off immediately to $6,500 will increase cash flow and assist small business to grow and invest in new equipment.

Support for small business: information assistance grants

The Government will establish a $40 million Energy Efficiency Information Grants program to provide information to small to medium businesses and community organisations on practical measures they can take to reduce their energy costs.

Being able to get clear information from trusted sources is vital to small business. So this program will be delivered through grants to industry associations and non-government organisations which have established relationships with small businesses.

Clean technology advice for small businesses

The Government will inject an extra $5 million over four years to improve delivery of clean technology advice and other non-grant business support programs to small and medium businesses. These include the Industry Capability Network, Supplier Advocates and Enterprise Connect.

Recognising carbon neutral businesses—Low Carbon Australia

Low Carbon Australia works with businesses to help them become carbon neutral. Taking part in Low Carbon Australia’s carbon neutral program can provide benefits such as:

• market opportunities including by positioning products as carbon neutral;
• business advantages including independent third party recognition of climate change and carbon management activities a company has undertaken; and
• reducing costs by reducing resource use.

AusIndustry support

AusIndustry provides a range of incentives to assist businesses grow.

The Australian Government allocated $240 million over four years to establish Clean Business Australia—a partnership with Australian business and industry for tackling climate change. The Climate Ready and Re-tooling for Climate Change programs assisted small to medium businesses to develop new technologies and services to respond to climate change and reduce their environmental footprint.

Other AusIndustry support has been provided to assist small businesses:

• grow their online presence;
• commercialise emerging technologies; and
• access advice after the recent natural disasters.

Small Business Support Line

The Government operates a highly successful Small Business Support Line to provide small business owners with a single point of contact for access to information and referral services to improve their business sustainability and better manage their business. Support Line advisers link into the network of Business Enterprise Centres and other small business advisory services around Australia.

Telephone: 1800 777 275 Monday-Friday 8am-8pm AEDST.   Email: sbsl@innovation.gov.au

Business.gov.au

Information and advice is also available online at business.gov.au. The website, which includes a grants finder is a free service and provides information, tools and resources from the Australian and State and Territory Governments to assist in planning for, starting and running a small business.

For further information about helping small businesses, see:

Carbon Pricing Mechanism: Who is liable?
Most companies operating large emitting facilities will be liable—those which generate over 25,000 tonnes of CO2-e emissions each year. Most of these companies directly emit greenhouse gases, such as power stations, mines and heavy industry. Some will be public authorities responsible for emissions from landfills.

Creating opportunities for farmers and land managers
Farmers will not have to pay for greenhouse gas emissions from agricultural activities and the fuel they use for farm equipment and personal vehicles will not be covered under the carbon price. Instead, over $1.7 billion of carbon revenues raised from the top polluting companies in Australia will be invested in the land sector over the next six years.

Small business
Small businesses will not be required to pay a carbon price. Small businesses will not have to count or monitor their carbon pollution or electricity use. They will not have to fill in a single form as part of the carbon price reform. The impact of a carbon price on small business will vary and most small businesses will not be significantly affected. A carbon price will create new job opportunities across a range of industries.

Biodiversity Fund
The Government’s new ongoing Biodiversity Fund of $946 million over its first six years will support landholders to undertake projects that establish, restore, protect or manage biodiverse carbon stores.

For further information about the Australian Government’s plan for helping small businesses see:

• business.gov.au
• AusIndustry
• Enterprise Connect