The Government’s increase to the Investment Allowance for small business in the May Budget has created a boost in the sales of commercial vehicles.
Commercial vehicle sales have experienced their biggest surge in nine years and a second consecutive monthly rise.
The motor vehicle industry has been suffering with the economic crisis as more individuals and businesses delay the purchases of new cars.
In March, car sales were down 22.4 percent. In April they grew 1.7 percent and following the increase in the Investment Allowances from 30 percent to 50 percent for small business in May, new car sales have grown by an additional 5.4 percent.
The Investment Allowance is giving the motor vehicle industry a much-needed boost and the rise of vehicle sales also suggests improved consumer and business confidence and a renewed sense of optimism.
NAB senior economist David De Garis said although sales have been supported by an increase in consumer and business confidence and the effects of the small business bonus tax deduction, employment will be the key factor in determining how quickly the economy will get back on the expansionary path.
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Small business investment allowance increase in Federal Budget