A new Federal Labor policy that gives an immediate tax deduction to businesses that invest in energy saving equipment will help slash energy bills, according to the Energy Efficiency Council (EEC).
Under Labor’s “Australian Investment Guarantee’ policy, businesses will be able to immediately deduct 20 per cent of an investment in eligible depreciable assets over $20,000, including those that lower energy use and improve energy efficiency.
EEC CEO Luke Menzel said the policy was timely, and recognised that Australia is in the midst of a massive economic transition that will require businesses to use energy more efficiently and productively.
“We know from a raft of reports over many years that Australian businesses use more energy than their competitors overseas, and Aussie manufacturers are at the back of the pack when it comes to energy productivity,” he said.
“That was fine, even five or six years ago. But now manufacturers and other large energy users are caught in a pincer movement between rising electricity and gas prices. And in some cases these cost pressures are threatening jobs and business viability."
Menzel said the good news is that businesses can quickly slash energy bills with ambitious energy upgrades that bring operations in line with global competitors.
The tax deduction was announced by Labor's energy spokesperson, Mark Butler.
He said the Australian Investment Guarantee is easily accessible to all businesses and will operate through the tax system, minimising compliance costs and maximising the benefits to business, workers and the climate.
“From small businesses upgrading refrigeration systems, to the largest manufacturers upgrading smelters, Australian businesses will receive permanent, targeted tax support to modernise and cut their energy bills,” Butler said.