This week, the NSW State Budget revealed that the payroll tax threshold would be increased from $750,000 to $1 million over the next four years.
The threshold will be progressively increased, starting with an increase to $850,000 for the year ending 30 June 2019, to $900,000 in 2019-20, $950,000 in 2020-21, before finally reaching $1 million in 2021-22.
For a business with a payroll over $1 mil, this will mean an annual saving of $13,625 each year after 2022.
These measures will be a welcome relief to NSW businesses on what is a counterproductive tax in the first place. The increasing of the threshold and the reduction of administrative burdens of reporting the tax will improve the capacities of business to spend money on growth or increasing their workforce to improve productivity; this is clearly a win for the NSW economy,
These proposals will bring the NSW government budget more into line with Queensland, the Northern Territory and Tasmania, all of whom already have thresholds in excess of the $1 million mark.
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