ACCOUNTANTS SYDNEY

The Treasurer handed down Budget 2018-19 at 7:30pm on Tuesday 8 May 2018. Below is a point form summary:

Tax

Personal

• Tax Rates: This Budget seeks to reduce the tax burden on individual taxpayers with a phased plan to reduce personal tax rates over the next 7 years.
• 37% tax bracket threshold increases from $87,000 to $90,000 from 1 July 2018 and $120,000 from 1 July 2022.
• From 1 July 2024, 37% rate will be removed completely, top marginal rate 45% will apply to individuals with taxable income over $200,000

• Medical Levy: remains at 2%. Previous proposal to add 0.5% has been abandoned

Business

• $20k instant asset write-off for small business extended until 30 June 2019
• The black economy: The Australian Tax Office’s enforcement budget for reining in the black economy will be beefed up. The ATO will carry out more audits, form “mobile strike teams”, improve its data analytics and set up a “Black Economy Hotline” for the public to report suspicious activity. Cash payments will be capped at $10,000 to limit the ability of black economy businesses to avoid paying tax.
• R&D: the federal government has chosen to target primarily big business rather than startups in its efforts to save $2.4 billion over the next four years. However, the startup sector has not escaped altogether, with the introduction of a $4 million cap on the cash refund available to companies with annual turnover of less than $20 million

Infrastructure

• Part of $75 billion 10 year- infrastructure program, $24.5 billion in funding for new major transport projects and initiatives that will benefit every State and Territory.
• The Melbourne Airport Rail Link is the largest infrastructure investment with $5 billion
• $3.5 billion Roads of Strategic Importance initiative will provide funding to upgrade key freight routes
• $1 billion Urban Congestion Fund is planned to reduce congestions in cities
• $406 million to water infrastructure project to make irrigation systems more efficient, improve water quality and create job.

Human Services, Health & Aged Care

• The government has announced A$1.6 billion over four years to allow 14,000 more older Australians to remain in their home for longer through more high-level home care places. For those in aged care, an additional A$82.5 million will be directed to improve mental health services in the facilities.
• The budget includes A$83.3 million over five years for a rural health strategy, which aims to place more doctors and nurses in the bush and train 100 additional GPs.
• New $1.3 billion health and medical research growth plan including $500 million to prioritise emerging study of genes and their functions.

Agribusiness

• $102 million to secure Australia’s biosecurity system with the aim of protecting Australia’s significant agricultural exports
• $51.3 million to be spent on six new on-the-ground agricultural trade councillors in new markets, plus the extension of those positions in Vietnam, Malaysia, the Middle East, China and Thailand, bringing the total to 22.
• $20 million in SME export hubs aimed at fostering enhanced cooperation between Australian businesses as they sell their products globally.

Defence, National Security, Cyber Security & Home Affairs

• Funding for Defence spending remains on track this year at $36.4 billion, setting the government on a path to meet their 2020/2021 two per cent of GDP funding target
• $294 million package was announced to improve the nation’s security against terrorist and other threats to air passengers, air cargo and international mail.
• The government will provide $59.1 million over four years from 2018-19 to enable the joint Commonwealth-States build of a National Criminal Intelligence System (NCIS)
• Additional Fund will be provided to support operations of Australian Federal Police (AFP), the Australian Security Intelligence Organisation (ASIO) and the Australian Criminal Intelligence Commission to strengthen their capacity to meet the Government’s national security objectives.
• $130 million is announced to upgarde the Department of Home Affairs’ ICT infrastructure for visa processing, identity management and threat analysis, to better detect and prevent threats.
• Newly-arrived refugees will have to wait six months before unlocking access to Centrelink’s full job search program to help them “focus” on learning English and adjusting to Australian life. The change, contained in the 2018 Budget, will save the government $68 million over the next four years