The 'Breadwinners' Budget

Federal Budget 2018 

Ambitious. Heroic. A pre-election Budget. This year's Federal Budget has many descriptors, but it's clearly one for targeting middle Australia.

Australian Treasurer Scott Morrison has presented his third Federal Budget and as you'd expect from an election budget, there is not a lot of bad news or serious cuts. 

While some are calling it an optimistic budget, the trending hashtag #keepmytendollars on social media suggests that the tax cut plan isn't not resonating with a large swathe of the electorate. The seven-year personal income tax plan initially targets low to middle income earners before making significant changes to the tax brackets by 2022 and 2024 that largely benefit higher income earners. 

For business, the sweetener of an extension to the $20,000 instant asset write off is offset by a number of stings designed to enhance compliance. The black economy features consistently with a multiagency taskforce and all manner of programs including the imposition of a limit of $10,000 on cash payments. 

Innovation continues to be the Government's mantra with the medical industry a clear winner. The Government has dedicated a total of $1.3 billion to fund genomic research projects investigating medicines that can be tailored to individual patients, clinical trials of new drugs and development of new medical technologies. 

There are also a number of tax changes to close loopholes and while not presented in the budget, the Treasurer has flagged the release of a discussion paper that will explore options for taxing digital business in Australia. There will be more to come – just not this year.

The key initiatives
  • $20k accelerated depreciation extended until 30 June 2019
  • Research & development incentive shake-up
  • Black economy – new initiatives and more industries rolled into the taxable payments system
  • Introduction of a 3-year cycle for SMSF audits for compliant funds
  • Seven year personal tax cut plan
  • Major innovation funding

Want to find out more?
Here's what's in the budget for:

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This article is provided for information purposes only and correct at the time of publication. It should not be used in place of advice from your accountant. Please contact us on 02 9957 4033 to discuss your specific circumstances.

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