Tax Laws Under a Coalition Government

Following the change of the Federal Government on 7 September 2013, it is worthwhile to review both the stated tax legislative changes made during the election campaign, and also the outstanding tax bills which have now lapsed due to the dissolution of the Government. 

There can of course be no certainties that what was promised during the election will be implemented, particularly considering the situation with the Senate.  However, the stated tax legislation changes announced by the Coalition during the election are as follows:

  1. Abolition of the Mining Tax.  Some measures that were introduced that were slated to be funded by the Mining Tax are to be discontinued, such as the instant asset write off for small business, accelerated depreciation for motor vehicles, the School Kids Bonus and the loss carry back measures;
  2. Cutting the company tax rate by 1.5% from 1 July 2015, subject however to a levy of 1.5% being implemented for companies with a  taxable income of more than $5 million to fund the Paid Parental Leave Scheme;
  3. Abolition of the Carbon Tax;
  4. Delay of the increase of the superannuation guarantee by two years;
  5. Not repealing the statutory formula method for car fringe benefits;
  6. Restoring the private health insurance rebate within a decade.

In relation to the Bills that were before Parliament and not finalised prior to the dissolution for the election, these will either have to be reintroduced or not be proceeding at all.  The outstanding Bills at the time of the election were:

2013 Bills

  • Tax Laws Amendment (2013) Measures No. 4 Bill 2013 Amending the research and development tax incentive, reducing quarterly R&D credits and amending the rules on refunding overpaid GST.

2012 Bills

  • Income Tax Rates Amendment (Unlawful Payments from Regulated Superannuation Funds) Bill 2012 Imposes the superannuation non-complying fund rate of 45% on amounts that are released early by illegal means. 
  • Tax Laws Amendment (Special Conditions for Not For Profit Concessions Bill) 2012 Amending the legislation to ensure that generally, income tax exempt entities must be operated principally in Australia for the broader benefit of the Australian community, standardising special conditions in order to become income tax exempt and provides a definition of the term “not for profit”.  For deductible gift recipients, requiring them to generally operate solely in Australia and pursue their purposes solely in Australia. 
  • Veteran Affairs Legislation Amendment Bill 2012 Exemption from income tax for reimbursements under the new pharmaceutical benefits scheme for veterans.