Last night Federal Treasurer Scott Morrison handed down his third budget, setting out his plans for the management of the Australian economy in the process. The Budget is expected to return to surplus by 2019-20, a year earlier than previously expected.
This is off the back of a stronger than anticipated economy and an increase in tax revenue of about $26B. Around half of this has been given away in the form of tax cuts to low and middle income earners, with sweeping tax reforms laid out via a 7 Year Personal Income Tax Plan.
There is also a strong focus on greater integrity in the tax system through the Black Economy measures and other more targeted and specific amendments.
- Budget deficit for 2017-2018 now forecast to be $18.2 billion – the lowest deficit in a decade
- Projected deficit of $14.5 billion in 2018-2019
- GDP growth predicted to be 3% per annum for the four financial years 2018-2019.
- Wage growth expected to be 2.25% in 2017-2018, rising to 2.75% in 2018-2019 and then 3.25% in 2019-2020
Corporate & Business
- Small Business $20K Instant Asset Write-off extended for another 12 months
- 27.5% corporate tax rate up to $50M Turnover
- 10 Year Enterprise Tax Plan remains (25% corporate tax rate by 2027)
- Overhaul of R & D Tax Incentive for over $20M turnover
- Increase in SMSF members from 4 to 6
- Super contribution opt-out for high income earners
- 3 year audit cycle for some SMSFs
- Superannuation exit fees removed from 1 July 2019
- 7 Year Personal Income Tax Plan
- Introduction of Low & Middle Income Tax Offset
- Removal of 37% tax rate by 2024/25
- Medicare Levy increase scrapped
For Fintechs, currencies like Bitcoin will now be free from GST (instead of double taxed)
- Increase of $1,200 or $1,800 for employers of skilled migrants
- Cash payment limit to business of $10,000 from 1 July 2019.
- $1.6 billion over four years from 2018-2019 to find an additional 14,000 high-level home care packages
- Small Business
- Older Australians
- Welfare Recipients
- Famous People
- Cash Users
- The ABC