The May 2018 Australian Federal Budget had little meat on the bone. Whilst there were a few, small tax reductions, either in the form of tax-offsets for low and middle-income earners or changes to the income tax brackets, many of these are not due to come into effect until after the next election (so may not be legislated at all – if there is a change of Government).
For small businesses, the extension of the immediate $20k write-off for depreciable assets for a further year to 30 June 2019 is welcome, but there was little else to make small business-owners smile.
The fact that the further Medicare Levy increase has been shelved had been announced before Budget Night, but we will also see a slight increase in the low-income thresholds for the reduction of the levy from 1 July 2018.
The Federal Government set out their continued commitment to reduce the company tax rate for large companies to 25% by the 2026-27 year, following previous reductions for small companies. However, there remains considerable opposition to this, so it is unclear whether these measures will ever be legislated.
Aside from these measures the remainder of the proposed changes relate primarily to tightening loopholes and reducing reliefs and there is certainly not much to write home about.
Further details – see Liz Copeland’s Tax Highlights