Our summary of the Federal Budget

With the Federal Budget handed down last night, the Bookssorted team attended a breakfast briefing in Parliament House this morning to get across the measures that may impact you.

It’s been a decade since the Global Financial Crisis and the end of our long-running Budget surplus. But, last night, Treasurer Scott Morrison announced that the Government expects us to reach surplus once again come 2019-20.

So, with our economy strengthening and a commitment to reducing income tax being flagged in all the pre-Budget speculation, how do you fair?

 

Income tax cuts

If your income bracket is between $48,000 and $90,000, from next financial year (2018-19) you will receive a tax cut of $530.

If you earn more than $90,000 you get some tax relief, but this reduces to zero at just over $125,000.

But that’s not all. The Government has put forward a staged tax cut package, to be implemented across seven-years which will eventually provide a single tax rate of 32.5 per cent for anyone earning between $41,000 and $200,000 a year.

The top marginal tax rate of 45 per cent will still apply to incomes above $200,000.

At the Budget breakfast, we heard the Federal Opposition state their support for stage one of this tax cut package, but we also heard the Federal Government commit that the package needs to agree to measures in full – so it will be interesting to watch this matter unfold.

 

Superannuation

The Government continues to make Superannuation a key part of its Budget package. Their Superannuation promises include:

• Giving the Australian Taxation Office (ATO) capacity to actively reunite people with their lost and inactive superannuation.
• Banning exit fees on superannuation accounts.
• Stopping super funds forcing young people to pay for life insurance.
• Increasing the SMSFs member limit to six, up from four; and a change of the SMSF audit cycle to three-years (currently annual), where SMSFs have a good record keeping history.

 

Government IT projects

The Government will invest $130 million to upgrade the Department of Home Affairs’ ICT infrastructure for visa processing, identity management and threat analysis, to better detect and prevent threats.

They are also providing $102 million for a smarter biosecurity system to better target the prediction, surveillance and enforcement of biosecurity risks.

What else took our interest?

 

Artificial Intelligence

As part of its innovation commitment, the Government has stated it will support the development of Australia’s artificial intelligence (AI) and machine learning capability to keep pace with global progress and improve our existing expertise in these technologies to maintain our competitiveness.

 

Consumer Data Right

The Government has announced the Consumer Data Right, which they say will revolutionise the provision of data services in Australia by giving Australians the ability to take control of their personal data and share it safely with trusted and accredited service providers.

“When consumers choose to share their data, businesses will be better able to offer financial products and services tailored to individual circumstances, such as personalised budgeting tools. The Right will also enable consumers to save money through improved price comparison and switching services.”

 

Mental Health support

The Government has stated their commitment to supporting people with mental illness, including committing $33.8 million to Lifeline Australia to enhance its telephone crisis services.

The Budget also focused heavily on support for our aging population, airport security and innovation.