Publication date: 02 Apr 19 |
Source: THE TAX INSTITUTE
CANBERRA, 2 April 2019: This populist Federal Budget is one like no other – it is most likely to be met with approval from the Labor opposition on the key tax aspects which target low to middle income workers and businesses.
Professor Bob Deutsch, Senior Tax Counsel at The Tax Institute commented that, “over 10 million Australian individual taxpayers and 3.4 million small and medium businesses will be showered with tax cuts”.
About 4.5 million individuals will benefit to the tune of $1,080 per annum ($2,160 for couples) through an enhanced offset starting immediately, with a further 5.5 million receiving a smaller trickle of tax offsets.
A deluge of business tax cuts aimed at businesses with annual turnovers up to $50 million include a reduced corporate tax rate to 25% from 2021-22 and a critical enhanced instant asset write-off for new equipment costing less than $30,000 purchased after 7.30pm on 2 April 2019.
This instant asset write-off applies on a per asset basis so eligible businesses can instantly write off multiple assets. This will most likely lead to a favourable surge in business reinvestment with a torrent of tax write-offs to flow.
Professor Bob Deutsch further comments, “Conspicuously, there is no evident intent to extend the Government largesse to higher income earners or big business - indeed, according to the Government’s own figures the top 10% of individual taxpayers are intended to bear a slightly greater proportion of the burden under the Government plan than they would otherwise.”
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