TAX NEWS - JUNE 2010

NSW Tax: Budget expected to cut payroll tax

There is expected to be a boost for business in the New South Wales Budget with two cuts to payroll tax.

A planned tax cut for next January from 5.65 per cent to 5.5 per cent will be brought forward to July.

There will be another tax cut in January 2011 to bring the rate to 5.45 per cent.

The Treasurer Eric Roozendaal says that will reduce payroll tax to its lowest level in New South Wales for more than 20-years.

"We know around 10 per cent of businesses pay payroll tax in New South Wales so it's a reasonable number of businesses that are impacted," he said.

"By the end of 2014 we would have delivered savings to businesses of more than $4 billion with the total number of payroll tax cuts that we've implemented."

However, unions are unhappy.

Mark Lennon from Unions New South Wales believes the government should be making better use of its surplus.

"We'd prefer the money to be spent encouraging young people to take up apprenticeships," he said.

"Clearly there's an increasing demand in this state for bringing forward some of our infrastructure spending and if a surplus can be used in that regard, we think that would be a better way to go."