Australia: Employment taxes, remuneration & superannuation in Mid-Year Economic and Fiscal Outlook

There are limited changes in FBT and income tax, however as a result of the repeal of the Minerals and Resource Rent Tax, there are quite a few changes to superannuation. These are outlined below:

Fringe Benefits Tax

After a crackdown in 2012 on the Living Away From Home Allowance (LAFHA) and in-house benefits FBT concessions, plus the aborted removal of the statutory formula method for cars this year, it is a relief that there are no FBT related changes in today's MYEFO.

Superannuation

A number of superannuation measures that were introduced with the Minerals Resource Rent Tax (MRRT) will be repealed. These changes result in a gain to the budget of $9.5 billion over the forward estimates period.

The low income superannuation contribution expense measure which was first announced in the 2010-11 Budget will be abolished, and will be applied to contributions made from 1 July 2013.

The Gradual Superannuation Guarantee increase from 9% to 12% will be adjusted, so the current increase at 9.25% will be maintained until 30 June 2016.

In addition, the Government will not proceed with the funding for the Priority consumer focused superannuation activities measure that was previously announced in the Pre-election Economic and Fiscal Outlook 2013.

Tax Rates

The Government will be retaining the current tax rates for residents:

Repeal of the tax bonus for working Australians

The Government has decided to repeal the Tax Bonus for Working Australians Act (No.2) 2009, which was introduced in the previous Labour Government, where tax bonus payments of up to $900 were to Australian residents who paid tax in the 2007-08 income year.

The Government believes that the issues of such cheques are no longer warranted, and as a result the ATO will no longer be issuing further tax bonus cheques upon the abolishment of the Tax Bonus for Working Australians Act (No.2) 2009. The repeal will come into effect the day after Royal Assent.

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