Tamworth's industrial sector given boost as government forfeits $550 million in tax revenue for upskilling

The move has drawn praise from the local business community, which said industrial hubs such as Tamworth would be in dire straits without major action being taken.

Small businesses will gain a $120 tax deduction for every $100 spent on skills and training, so long as the course is run by an external nominated provider and is registered in Australia. The program will run until June 30, 2024, and is expected to cost the government $550 million in tax revenue.

Tamworth Business Chamber president Stephanie Cameron said the commitment would help future-proof the workforce, especially in the industrial sector, although she would've liked to have seen it sooner.

"It's absolutely key because we need a pipeline of skilled staff coming through and, along with that, we need to make sure they get the right training and right education ... that what the training providers out there are providing is relevant and up-to-date for current business circumstances too.

"I think it's come a little bit too late, but it's better late than never. The shortage is now, but what is good to see is the government investing, in that the shortage is minimised as much as possible in the next two or three years."

Trent Balderston, a director and financial planner at Tamworth financial firm Bell Partners, agreed the incentives are needed to continue the rejuvenation of the trade industry.

However, he expressed concern businesses wouldn't see the full benefit of it unless Labor committed to keeping the program, or launching something similar if they win the election in May.

"On the surface you look at it and go 'these programs make sense', they're the kind of policies that are forward-thinking that you want built into a budget," he said.

"So the expectation would be that the budget reply speech will come out with 'yes we'll take it to the election'.

"As it sits at the minute Labor are ahead in the polls, and they wouldn't be in a situation where they necessarily want to go 'we're not adopting this thing that is popular'."

READ ALSO:

He said reversing the policy wouldn't be "politically smart" and he wouldn't be surprised to see the opposition increase the deductions or expand the criteria.

Upskilling incentives weren't the only dangling carrot for small businesses though, with another $120 tax deductions also being offered for every $100 spent on technological investments such as subscriptions to cloud-based services, portable payment devices and cybersecurity systems.

Bell Partners' Mr Balderston said this will have a major impact in regional areas, where there are still many businesses relying on cash payments or using old-fashioned books to do their finances.

An uptake in technology from mum-and-dad style outlets could provide a noticeable boost to the economy nationwide, he believes.

"When we're talking to small business owners we're saying 'you need to start adopting some of these technologies or you'll get left behind'," he said.

"And the pushback you often get is 'I just don't understand it', but this is where you can put the two [tax deductions] together and employ someone and train them to get really good at it.

"And they can go 'I can trust them to do it and my business can go forward with that type of growth', so if you leverage the two together you can set yourself up for this new economy that we're about to move into."

Our journalists work hard to provide local, up-to-date news to the community. This is how you can continue to access our trusted content: