COSBOA sets out Federal Budget priorities calling for permanent $150,000 instant asset write-off, lower taxes, and reduced regulatory burden to restore small business confidence.
What’s happening: The Council of Small Business Organisations Australia has outlined its priorities for the 2026-27 Federal Budget, calling for policy settings that enable small businesses to remain viable and confident to invest.
Why this matters: Rising operating costs, particularly energy and insurance, continue to weigh on business confidence, limiting their capacity to invest, employ, and grow in an economy dependent on their success.
Small businesses are resilient, but resilience alone cannot carry Australia’s economy forward, according to the Council of Small Business Organisations Australia, which has set out its priorities for the 2026-27 Federal Budget.
COSBOA’s priorities focus on reducing the cost of doing business, particularly energy and insurance, providing certainty to invest through a permanent $150,000 instant asset write-off, tax settings that support growth and jobs, smarter regulation that reduces duplication, and continued investment in digital capability and emerging technologies.
“If we want stronger productivity growth and more secure jobs, the policy environment has to support small businesses to invest with confidence, employ people and expand their operations,” said Matthew Addison, COSBOA Chair. “That means addressing the structural cost, tax and regulatory settings that shape day-to-day business decisions.”
Certainty to invest
Legislating a permanent $150,000 instant asset write-off sits at the centre of COSBOA’s agenda, providing small businesses with confidence to invest in equipment, technology, and vehicles that directly improve productivity and output.
“Small businesses make investment decisions over years, not months,” Addison said. “Certainty in the tax system allows them to plan ahead, upgrade equipment, adopt new technology and lift their productive capacity.”
The instant asset write-off threshold has fluctuated considerably in recent years. In Budget 2024, the threshold was extended at $20,000 through to June 2025, before reverting to just $1,000. COSBOA is calling for a permanent $150,000 threshold to provide long-term planning certainty.
Rising operating costs continue to place increasing pressure on small businesses, with energy and insurance costs rising faster for small businesses than for larger firms.
“Regulatory overlap, duplicative taxes and unnecessary procurement requirements are driving costs up and directly affecting cash flow and viability,” Addison said.
Tax reform urgency
Tax reform remains a key productivity lever in COSBOA’s submission. The peak body is advocating for reducing the small business company tax rate from 25 per cent to 20 per cent for businesses earning under $20 million, alongside appropriate tax incentives for unincorporated small businesses, including sole traders and partnerships.
Payroll tax remains a significant concern, with COSBOA’s pre-budget survey finding that 89 per cent of respondents believe payroll tax should be overhauled due to its impact on jobs and growth.
“While payroll tax is administered by the states, the Federal Government has an important leadership role to play,” Addison said. “A nationally coordinated approach to harmonising payroll tax regimes, including thresholds, rates and reporting requirements, would reduce complexity, remove barriers to expansion and support employment growth across jurisdictions.”
Workforce and digital future
Workforce shortages also remain a significant constraint on small business growth. COSBOA supports targeted incentives for apprenticeships and traineeships, improved recognition of licences and qualifications nationwide, and migration settings that are workable for small employers.
Looking ahead, COSBOA says investment in digital capability, including AI, is essential to future productivity growth. While many small businesses already use digital tools, adoption of emerging technologies is being held back by cost, skills gaps, and lack of practical support.
“Small businesses are a core pillar of the Australian economy,” Addison concluded. “Ensuring the right policy settings are in place so they can invest and grow is essential to strengthening Australia’s economic foundations.”
COSBOA will continue to work closely with Government to ensure the voice of small business is reflected in policy decisions and the sector is supported to play its full role as an engine of jobs, productivity, and economic growth.
The full COSBOA pre-budget submission can be accessed here.
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