Improved economic performance towards a stronger sustainable structure!
The Mid-Year Economic and Fiscal Outlook (‘MYEFO’) report was recently released. It indicates that the underlying Budget deficit is expected to be $5.2 billion in 2019 (down from the $14.5 billion deficit estimated in the 2018/19 Federal Budget).
The substantial deficit reduction is reportedly a result of increased tax collections, with individual tax collections up $4.1 billion and company tax
collections up $3.4 billion. Additionally, the MYEFO report also provides a useful snap shot of what the Government is thinking when it comes to tax policy – particularly where previously announced reforms are still pending.
A few tax-related policy updates confirmed in the MYEFO worth mentioning include the following:
- GST compliance program – The Government is looking to provide $467 million of ATO funding from 2020 to 2024 to fund additional GST-related audits and the development of analytical tools to combat emerging risks to the GST system.
- $10,000 cash payment limit – The Government will delay the introduction of an economy-wide cash payment limit of $10,000 from the originally proposed 1 July 2019 start date, until 1 July 2020.
- Abandonment of the proposed changes to intangible asset depreciation – The Government has announced it will not be proceeding with the current proposal to allow taxpayers to self-assess the effective lives of certain intangible depreciating assets.
- Super access for victims of crimes – The Government proposes to introduce legislation to allow victims of certain crimes (i.e., serious violent crimes) access to their perpetrator’s superannuation to pay any outstanding compensation.
- Increasing the integrity of limited recourse borrowing arrangements (‘LRBAs’) – The Government is making an adjustment to the previously
announced reforms requiring outstanding balances of LRBAs to be included in a member’s total superannuation balance by extending the start date and limiting impacted taxpayers.
- Superannuation guarantee (‘SG’) penalty increase – Where employers fail to come forward during the 12-month SG amnesty, the Government is proposing to increase the minimum penalty from 50% to 100% of the Superannuation Guarantee Charge.
For more details on the tax policy updates, please do not hesitate to call us at Verus Accountants and Advisors. We are ever ready to receive your queries. Visit our site here today to know more on how we can actually help you.