The Government predicts a return to surplus of $7.1 billion (or 0.4% of GDP) in 2020 – the first surplus in 12 years. Assuming they stay in office, they are projecting increasing surpluses over the next ten years from 0.4% of GDP to 1.8% of GDP. The last time our country achieved in surplus was in 2008, just prior to the GFC.
Small & Medium Business
- The instant asset write-off has been extended to June 2020 and increased from budget night from $25,000 to $30,000 for businesses with annual turnover of less than $50m. Previously these write offs were only available for small business with turnover under $ 10m per annum.
- tax cuts will be brought forward (25% down from 27.5%) for companies with annual turnover of less than $50 million from the 2021-22 income year
- the controversial proposals surrounding extending Division 7A measures have been deferred until 1 July 2020
- there will be $60m extra funding for the Export Market Development Grant Scheme over the next three years
- there will be a new requirement for businesses to have a good track record with the ATO and other agencies when tendering for Government contracts
- $1bn to be spent on ATO anti-avoidance task force tackling the “black economy”
- Limited legal assistance will be given to small businesses who have a dispute with the ATO
- Luxury car tax refunds will increase for farmers and tourism business operators from a maximum of $3,000 to $10,000
- ABNs will be tidied up – if you don’t lodge overdue tax obligations by 1 July 2021, your ABN will be cancelled
- Superannuation voluntary contributions for those aged 65 and 66 to be allowed without having to satisfy the work test from 1 July 2020.
- Those aged 65 or 66 can now access the “bring-forward rule” for non-concessional contributions
- You will be able to make contributions for your spouse up to age 74.
- Tax brackets to be cut and amalgamated – the government will reduce the 32.5% rate to 30% for taxable incomes between $45,000 and $200,000 from July 2024
- Low and middle income tax offset to be increased starting 2019 tax returns
- There will be 23,000 places set aside for two new regional visas for skilled workers requiring them to live and work in regional Australia for three years before being able to access permanent residence. This is an attempt to address the shortage of skilled workers in regional areas.
- There has been $1.5bn allocated for the north-south corridor in Adelaide
- $5.7 bn worth of City Deals for Adelaide, Hobart, Townsville, Launceston, Western Sydney, Darwin and Geelong, with negotiations underway for South East Queensland and Perth.