Small and medium-size businesses suffering from energy bill shock are set to receive support to undertake electrification and efficiency upgrades through targeted tax incentives in the upcoming May budget.

The Australian Chamber of Commerce and Industry, and its 400,000-strong small business network, has welcomed the $314 million energy efficiency scheme announced by the federal government today.

Under the scheme, set for the next financial year, small and medium-size businesses with a turnover of up to $50 million will be able to claim an additional 20 per cent tax deduction on investments of up to $100,000 in electrification and energy efficiency.

“Small businesses across the country have seen their gas and electricity bills skyrocket in the past 12 months, so any relief to reduce soaring energy costs is welcome,” ACCI chief executive Andrew McKellar said.

“Small business owners recognise the importance of transitioning to net zero, but often face challenges in taking the first steps in making meaningful progress towards reducing their carbon footprint.

“There are huge opportunities for small businesses to go green, not just to contribute to the cause of combating climate change, but also for businesses to grow and ensure their future competitiveness.

“Modest changes to improve energy efficiency and adopt more sustainable practices can set a business apart from its competitors, lure new customers and investments, and reduce operational expenses.

“Small and family businesses are the backbone of the Australian economy, so as we transition to a net-zero future it’s critical that they are supported to reduce their emissions and invest in clean energy.”