SA-BEST calls for a reduction in Payroll Tax for Regional Businesses

Payroll Tax is a tax on jobs and is a bottleneck to business growth. We all know it – but it remains a massive revenue source for the government.

Since 2019 the Payroll Tax threshold has remained at $1.5 million, with the maximum tax of 4.95% applying once a business reaches $1.7 million in annual wages. 

Inflation and wages growth means that even small and developing businesses are being hit with this additional tax. 

SA-BEST backs the SA Business Chamber’s call for the government to implement sensible and sustainable increases to the Payroll Tax threshold for all South Australian businesses, and for Payroll Tax exemptions or discounts for businesses which promote the employment of graduates, trainees and apprentices.

South Australia has amazing regional areas, but many are struggling with investment and infrastructure. In Queensland and Victoria, businesses established and operated in regional areas pay less in Payroll Tax. 

For example, while the Payroll Tax threshold in Victoria is lower ($1 million), regional businesses enjoy a discounted tax rate of 1.2125%, which is 4 times less than South Australian businesses.

The SA Business Chamber also calls for a 50% reduction in Payroll Tax for regional businesses, equating to a maximum 2.475% payroll tax.

SA-BEST MLC Connie Bonaros said: “Offering our regional businesses a 50% Payroll Tax reduction will not only allow us to remain competitive with other states but will help our regional businesses grow and incentivise new businesses to open. That is good for our regions and good for all South Australians.

"Let’s release the handbrake on our regions.”

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