Scott Morrison is offering tax cuts to both business and average-earning workers in his attempt to modernise Australia's taxation system.
The treasurer on Thursday introduced to parliament his 10-year plan to cut the company tax rate incrementally from 30 per cent to 25 per cent.
Announced in the May 3 budget, the rate will immediately reduce to 27.5 per cent for all businesses with an annual turnover of up to $10 million.
The corporate rate will be gradually lowered over the next decade for more companies with all benefiting in 2026/27.
The measures would provide the encouragement needed for Australian businesses to grow and create jobs, Mr Morrison told parliament.
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He noted only five OECD countries have a higher corporate tax rate than Australia, while our neighbours have lower rates.
Australian Small Business and Family Enterprise Ombudsman Kate Carnell believes it's important the tax breaks for small business come to fruition as soon as possible.
It was right politicians argue the case for immediate action on reducing the level of debt and budget deficit.
"An important element of this budget repair is empowering small businesses to generate much needed economic growth through tax breaks that allow them to re-invest and grow their business," Ms Carnell said in a statement.
Separately, Mr Morrison introduced legislation to increase the upper limit for the middle-income tax bracket from $80,000 to $87,000, another promise from the budget.
This will help those on average wages remain in that bracket and prevent about 500,000 taxpayers from facing the second highest tax rate of 37 per cent through wage inflation, otherwise known as bracket creep.
"It is crucial that we have a modern tax system that allows people to work more, take more risks, without facing the pressure of a growing tax burden that suffocates hard work innovation and enterprise," Mr Morrison said.
These personal income tax cuts came into effect from July 1 and will be backdated once the legislation clears parliament.
