What's happening in politics

Confused??? It's understandable if you are. The last Federal Budget contained a series of severe cuts. Some of those passed Parliament, while others are pending the outcome of negotiations with the minor parties. Some have just died a slow and protracted death. Keeping track of what announcements are now law is difficult. Here's a quick summary:

• Carbon Tax - abolished.
• Mining Tax - abolished along with the associated business initiatives such as the loss carry back rules, accelerated depreciation for motor vehicles and the instant asset write off.
• Superannuation guarantee (SG) – re-phased as part of the mining tax repeal. Now, the SG rate will remain at 9.5% until 1 July 2021.
• School kids bonus - was to be abolished as part of the mining tax repeal but is now means tested until 31 December 2016, before being abolished.
• 2% Debt tax - applies between 1 July 2014 until 30 June 2017 to those with annual taxable incomes over $180,000. In line with the debt tax, FBT rates will also increase from 47% to 49% from 1 April 2015 until 31 March 2017.
• Biannual indexing of fuel excise – introduced by stealth as a tariff proposal.
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There are a series of other announced reforms that have either been rejected or stalled in the Senate. These include Family Tax Benefit reform, the $7 fee for GP visits, an increase in the pension age to 70, the 6 month wait for unemployment benefits, and deregulation of University fees. The Coalition's paid parental leave scheme also faded from view.

The impact of Government policy is likely to be the biggest issue for many individuals but at this stage, it is unclear how and when the Government will seek to recoup the deficit. That leaves the regulators to try and plug the hole. A key target is individuals with overseas sourced income – if this is you, you need to be absolutely certain about what income is taxable in Australia.

Source: 4U Accountants 2015