$150 power bill saving cold comfort for pub owner
An extra $150 thanks to Federal Budget power bill relief is cold comfort to small businesses, particularly those in hospitality.
Adelaide publican Simone Douglas told The Australian that she, like all Australians, is battling skyrocketing energy costs and a cost of living crisis, with electricity costs at her CBD hotel, the Duke of Brunswick, jumping by more than 45 per cent last year. Her quarterly bill rose to $16,000 in the December quarter.
Douglas is calling for a “meaningful impact on the cost of energy for business”, before more hospitality businesses go to the wall.
“If I get the $475 in bill relief they’re banging on about … when you’re paying $16,000 a quarter for electricity, you might as well leave that $475 in the bank quite frankly,” she said.
“There’s a lot of small and family businesses out there who are really feeling the pinch, and their major costs of gas, electricity, water and insurance are probably the big ticket items outside of the cost of labour.
“I really do wonder whether the solution is actually getting back to a point where gas, power and water is in the hands of the state government or the Commonwealth. We can’t keep seeing it escalate.”
The Albanese has extended the $325 energy rebate by six months.
One positive budget announcement was the extension of the $20,000 instant asset write-off for small businesses. Should the Coalition form government after the may election, it has stated it will lift the write-off threshold to $30,000 and make it a permanent benefit rather than subject to legislative approval each year.
“Maintaining the instant asset write-off is pretty important, and also drives the economy,” Douglas told The Australian.
“We make decisions about what we’re spending based on whether or not we can get the tax concessions back.”
To stimulate demand in the hospitality industry, Douglas suggests reforming fringe benefits tax. The Coalition's proposal includes a $20,000 tax deduction for business-related meal and entertainment spending by small businesses (turnover up to $10m), which would be exempt from fringe benefits tax, but excludes alcohol.
“A big-ticket item that you’d love to see some movement on … is fringe benefits tax, because you’re actively penalising businesses for spending money in the local economy on their staff,” she said. “Let the electrician take his apprentices to the pub for a parmy when they’ve worked in 40 degree heat, and let them make it tax deductible – why should they foot the bill?
“We see what’s happening with hospitality and businesses announcing their closure … and the hospitality industry is a great litmus test for the wider economy, because if people aren’t spending money in hospitality then they generally don’t have money to spend. People are still going out for special occasions … but they tend to, instead of going out once a week, they might be going out twice a month.”
Jonathan Jackson, 26th March 2025
