Election Result – what next for tax reform?
20 May 2019
With the coalition eyeing a majority victory following Saturday’s election, BDO Tax Partner, Mark Molesworth has commented on the Morrison government’s back-to-work agenda:
“During the election campaign, Mr Morrison focussed on bringing in a range of personal tax cuts over the next 10 years,” Molesworth said.
“The first item on his agenda will be to look at getting these through Parliament.”
“However changes to tax rates should not, on their own, be seen as tax reform.
“The Government needs to look at reigniting the debate on holistic tax reform for all taxes in both the Federal and State tax systems.”
Proposed tax cuts announced by the Morrison Government include:
- From July 1, 2018, the Government increased the top threshold of the 32.5 per cent tax bracket from $87,000 to $90,000
- From July 1, 2022 the top threshold of the 32.5 per cent tax bracket will be increased from $90,000 to $120,000
- From July 1, 2024, the Government will increase the top threshold of the 32.5 per cent tax bracket from $120,000 to $200,000, removing the 37 per cent tax bracket completely
- In its 2019 Budget, the Government announced taxpayers earning up to $126,000 per year would get $1,080 back at tax time. That plan also promised to flatten tax brackets by 2024 so all taxpayers earning between $45,000 and $200,000 would have their tax rate reduced to 30 per cent.
BDO's full Federal Budget 2019-20 analysis is available here.