Budget 2018: $20K asset write-off can help our business fly

Ben Phillips, 32, flies hot air balloons across Melbourne for a living but red tape keeps bringing him back to Earth.

Up, up and away ... Ben Phillips, at a balloon launch at Westerfolds Park in Melbourne, says tax deductions are a huge help for his business. Picture: David Geraghty

Ben Phillips, 32, flies hot-air ­balloons across Melbourne for a living but childcare costs, immigration changes and red tape keep bringing him back to earth.

Mr Phillips is general manager of Picture This Ballooning, owned and operated by the Crock family.

He says tax cuts passed last year for companies making up to $10 million have allowed the company to buy more equipment, but there are still steps he wants the government to take.

“The cut from 30 per cent to 27.5 per cent has allowed us to invest in more capital ... but there are so many other costs,” he said.

“What really matters for us are increased tax deductions because the business pours so much money into training and equipment,” he said.

“Like the deductions for small businesses in Tony Abbott’s second budget … they made the biggest difference.”

The main new tax measure pitched at small business in yesterday’s budget papers was an extension to the $20,000 instant asset write-off for a further 12 months. The measure, which allows small businesses to deduct purchases of certain assets that cost up to $20,000, will now run to June 30 next year.

Another measure in the budget that could possibly benefit the business is a $260m investment in global positioning system technology that will make the technology more precise.

Sectors such as aviation are expected to benefit. As well, the Bureau of Meteorology is set to get funds to continue to improve its systems and infrastructure, another move that benefits sectors such as aviation that rely on weather information.

Training is a big cost for Picture This. The company has often looked overseas for people with the right training to helm a balloon. The scrapping of 457 visas hasn’t helped.

“Lots of money goes into training for us and the 457 visa changes have been difficult as most of our trained staff were from offshore. There’s a big shortage,” Mr Phillips said.

On skills, Scott Morrison pointed to an extra $250m for the Skilling Australians Fund, which provides support for apprenticeships and traineeships.

Mr Phillips said he had issues training staff so the fund “sounds good for us”.

He also welcomed the extension of the instant asset write-off until 2019.

Picture This’s 35-strong staff work irregular hours, often starting at 5am to get ready for balloon flights at dawn. As a result, Mr Phillips said, the business had reimbursed most of its staff’s childcare costs. “We need our staff to be as flexible as possible so we end up paying for most of the childcare,” he said.

Red tape is another factor keeping Mr Phillips and Picture This on the ground. “Less red tape is always good ... of course, a lot of the regulations we deal with concern passenger safety, which is very important. But there are other areas like accounting and bookkeeping … it would be useful if they changed those.”

And Picture This’s power bills are high. “We have definitely noticed increases in gas and electricity bills,” Mr Phillips said.