The federal government says small business owners, full-time wage earners and companies will benefit from tax concessions and cuts.
Small business owners will pay less tax from July 1 following measures announced in Tuesday's federal budget.
The small business tax rate will be lowered to 27.5 per cent and the turnover threshold to access it will be increased from $2 million to $10 million.
"This will mean 870,000 businesses, employing 3.4 million Australians, will have their tax rate reduced," federal Treasurer Scott Morrison said.
Businesses with a turnover of less than $10 million will be able to access other tax incentives, including the small business depreciation pooling provisions and the Pay-As-You-Go installments payments option.
"Small and medium businesses are driving jobs growth in Australia," Mr Morrison said.
"A tax on their business is a tax on their enterprise and the jobs they provide."
An incentive allowing small businesses to instantly write off equipment purchases of up to $20,000 will be extended until June 30, 2017.
