The ‘Breadwinners’ Budget
Reward for work is a dominant theme in this year’s Budget. The seven year personal income tax plan initially targets low to middle income earners before making significant changes to the tax brackets.
Innovation continues to be the Government’s mantra with the medical industry a clear winner. The Government has dedicated a total of $1.3 billion to fund genomic research projects investigating medicines that can be tailored to individual patients, clinical trials of new drugs and development of new medical technologies.
As you would expect from an election budget, there is not a lot of bad news or serious cuts. The black economy however features consistently with a multiagency taskforce and all manner of programs including the imposition of a limit of $10,000 on cash payments.
There are also a number of tax changes to close loopholes and while not presented in the budget, the Treasurer has flagged the release of a discussion paper that will explore options for taxing digital business in Australia. There will be more to come – just not this year.
Key initiatives
- $20k accelerated depreciation extended until 30 June 2019
- Research & development incentive shake-up
- Black economy – new initiatives and more industries rolled into the taxable payments system
- Introduction of a 3-year cycle for SMSF audits for compliant funds
- Exemption to the work test for retirees aged 65-74 with superannuation balances below $300,000 and who make voluntary contributions
- Investors will be unable to claim expenses associated with holding vacant land
- Seven year personal tax cut plan
- Introduction of the Low and Middle Income Tax Offset (legislation yet to be passed in Parliament)
- Measures to encourage pensioner financial independence
- Major innovation funding
Read a full summary here: Budget 2018-19 SRJ Walker Wayland
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