Last night the Treasurer handed down his second budget in 7 months and whilst this is generally my favorite day of the year I must admit, it felt a little more like groundhog day than the usual excitement it brings. (Just me? Ok then.)
I’m calling this budget a great budget. There was alot in there but I’ll narrow it down to my personal top 5. If you would like a more in depth read, download our IQ budget explainer.
My highlight was the “Digital Economy Strategy” which was announced earlier this month which plans to invest $2b to lift our competitiveness and productivity with the aim to increase jobs and wages. This includes a review of myGov and expanding the Digital Solutions – Australian Small Business Advisory Service to help businesses improve their digital processes and take up new things like e-invoicing.
There were some prior announcements that received extensions such as the fully expensed assets, temporary loss carry back and low and middle income tax offsets. All good news.
But back to the top #5
- Modernising the individual tax residency rules – this is a good one and the proposal is much simpler than the current legislation. It will be interesting to see the start date and what changes are made (if any) through the legislative process.
- Change to self education expenses – previously the first $250 spent was non deductible. This is being removed.
- Removal of the taxing point for ESS (Employee Share Schemes.) Whilst this doesn’t effect all individuals, it has been a “nasty surprise” for many when they have left a company that issues employee shares. I’m pleased to see this change but await the start date.
- Changes to debt recovery action by the ATO when a taxpayer is in dispute and has filed a claim with the Administrative Appeals Tribunal. Currently, whilst the dispute is being reviewed – the ATO can still continue with debt recovery action including interest, penalties and issuing garnishee notices. This one just practically makes more sense.
- The removal of the $450 per month threshold for superannuation guarantee. I have this here more from an interest viewpoint as I was surprised by this one as for me personally, the reasoning behind this change doesn’t make a heap of sense. This one will be a sting for some employers and we don’t know the start date as it’s “the first year after the it receives royal assent” so watch and wait.