There you go, another budget speech delivered, and if it wasn’t clear, back in black seemed to be the theme of the evening. Frydenberg announcing a range of cuts, incentives and infrastructure spending that will no doubt have impact for people across Australia. We whipped up a quick video, watch it here.
The Government continued their habit of redefining what a ‘small business’ is, offering those with under $50million annual turnover the opportunity to instantly wipe off the tax of business purchases up to $30k. Then the Treasurer suggested, with a tax write off like that, you could go and buy yourself a new fridge. Harvey Norman might have a good month? #TaxWriteOff
Significant changes may be realised regarding personal income tax rates, and more importantly the tax brackets themselves. Under 45k, you’ll be handing over 19c to ScoMo. 45k to 200k? You’ll be waving goodbye to 30c in the dollar.
This essentially eliminates the existing bracket at 87k to 180k, while shuffling the rates around, for a ‘simpler’ tax system. As an example, if you’re earning 100k, you’ll see close to 5k back in your pocket under the new scheme, which is a big difference, which realistically is going to boost punters’ deposable income. All part of the Governments plan to ensure the local economy remains healthy as global partners and developing nations look increasingly risky.
In a post budget speech interview with the ABC, Josh was questioned around the validity of his claims, specifically around the guaranteed surplus, a bold statement in the current economic climate. Commodities, and Australian exports are particularly important to his equation, yet are the most exposed to global trade and subsequent movements in global economies. Begging the question, is this realistic, or idealistic? Australia is a strong economy, we are however tied to global markets, and what happens to trading partners will directly impact us, the extent to which we will be is where the argument lies.
Keep in mind the majority of this will be actioned if the Liberal Government remain in power, meaning, we still don’t have certainty about the likelihood of these policies coming to the table. Perhaps don’t get too excited. Current odds are putting Labour as the clear favourite at a 5:1 chance.
What did Illumin8 notice?
Shane shared that improved data matching was going to help the ATO & Centerlink work together, to actually see what you’re receiving. Making reporting benefits accurately really important.
Christina noticed the proposed increase of the instant tax write off threshold to 30k.
Mick chatted about increased funding for apprenticeships over the next five years. Good news for employers, and job seekers.
And our friend James O’Reily unpacked what the cash implications could be under the proposed rejig of tax rates and brackets.
Watch the video for the team’s key points. If you have any questions, reach out,we’d love to hear your thoughts, and answer any queries you might have around how this could impact you, your family, and your business.