Budget to benefit optometrists and practices through tax cuts and investment incentives

By Optometry Australia

The budget was designed to stimulate economic recovery and includes personal income tax cuts that will see many pay lower tax bills for the current financial year than in 2018-2019. The budget essentially brings forward Phase 2 of the Government’s previously announced tax plan.

Much of the media has been heralding business as the winner of this year’s budget, and certainly for optometry businesses, there are a number of new initiatives worth looking into, including:

• From now until June 30, 2022, businesses with a turnover of under $5 billion will be able to deduct the full cost of an eligible asset in the first year it is used or installed. This essentially reduces the amount of tax a business will pay in the short term and it is intended to encourage business investment.
• Until June 2022, a temporary ‘loss carry-back’ provision, enabling companies with a turnover of under $5 billion to receive a refund of taxes paid on profits made from 2018-2019 onward, if they record a loss in the last, current or next financial year.
• The JobMaker initiative, which offers weekly incentive payments for businesses that employ staff aged between 16 to 35 in a new role and who were previously accessing JobSeeker or Youth Allowance.

‘Unsurprisingly, the health budget centres on comprehensive investment in supporting Australia’s ongoing response to COVID-19, and increased investment in aged care and mental health services. It includes ongoing and boosted spending in research and, encouragingly, increased investment in both Aboriginal and Torres Strait Islander health care, and rural and regional health care and workforce. It remains unclear if the latter will support and incentivise optometrists to provide care in rural areas and we will follow up on this,’ Optometry Australia CEO Lyn Brodie said.

The health budget also includes funding for a second wave of reforms to private health insurance, including increasing the age of dependants on policies from 24 to 31 years. The health budget also funds a ‘continuous’ review of the MBS although the outcomes of the recent MBS Taskforce reviews into both optometry and ophthalmology items (amongst others) are yet to be announced.

‘With specific regard to eye care the budget includes announcements of PBS listing of Eylea (aflibercept) from 1 October 2020, investment in ending avoidable blindness for Aboriginal and Torres Strait Islander people, and research funding for the development of a novel treatment for AMD. These did not come as a surprise as they were well known prior to budget night.’

‘In all, the Federal budget is expected to benefit optometrists and optometry practices, primarily through tax cuts and investment incentives, and will support you in continuing to provide important community eye care’, Ms Brodie said.

‘We will also continue to scour the budget and will bring you more information if, and when it becomes available, about other initiatives of relevance to optometry, optometrists and optometry practice owners’, Ms Brodie added.

For further insights into the budget, please see this article and analysis from Optometry Australia’s Advantage Partner, RSM Australia.