The Morrison Government will deliver significant tax relief as part of our Economic Recovery Plan for Australia to create jobs, rebuild our economy and secure Australia’s future. Bringing forward Stage two of our Personal Income Tax Plan will see more than 11 million taxpayers get a tax cut backdated to 1 July 2020. Business will … Continue reading “Tax Relief To Back Hard-Working Australians And To Create More Jobs”
The Morrison Government will deliver significant tax relief as part of our Economic Recovery Plan for Australia to create jobs, rebuild our economy and secure Australia’s future.
Bringing forward Stage two of our Personal Income Tax Plan will see more than 11 million taxpayers get a tax cut backdated to 1 July 2020.
Business will be supported with time‑limited tax incentives that will provide immediate expensing and loss carry-back.
This will generate economic activity and create jobs by lowering the cost of investment.
It is estimated these measures to reduce the personal income tax burden and encourage business investment will create around 100,000 jobs by the end of 2021-22 and boost GDP by around $6 billion in 2020‑21 and $19 billion in 2021-22.
Tax relief for individuals
Personal income tax cuts announced in the last two budgets helped to put more money into the pockets of hard‑working Australians and in the process strengthen our economy to respond to the impact of COVID-19.
As part of the 2020-21 Budget we will bring forward Stage two of our Personal Income Tax Plan by two years. From 1 July 2020:
The Government will also provide additional targeted support to low- and middle-income Australians. In 2020‑21, low-and middle-income earners will receive a one-off additional benefit of up to $1,080 from the low and middle income tax offset (LMITO).
The LMITO was to be removed with the commencement of Stage two, but the one‑off additional benefit in 2020-21 will provide support to households and stimulus to the economy.
Together, bringing forward Stage two and providing the additional LMITO means more than 11 million Australian taxpayers will get a tax cut, with effect from 1 July this year, providing them with more money to spend on what matters to them.
As they spend their tax cuts this will help local businesses to keep their doors open and hire more staff.
More than 7 million individuals are expected to receive tax relief of $2,000 or more for the 2020-21 income year compared with 2017-18 tax settings. Low and middle income tax payers will receive relief of up to $2,745 for singles and $5,490 for dual income families.
This will reward effort and creates jobs.
Tax relief for business
Around eight in every 10 Australians are employed in the private sector.
To help rebuild our economy and create more jobs we need to kick-start activity in the private sector.
Building on the successful expansion of the instant asset write-off in our response to COVID-19, we will now allow 99 per cent of businesses to write off the full value of assets they purchase.
Businesses with a turnover of up to $5 billion will be able to immediately deduct the full cost of eligible depreciable assets acquired from 7:30pm (AEDT) on 6 October 2020 and first used or installed by 30 June 2022.
It will unlock investment, expand the productive capacity of the nation and create tens of thousands of jobs.
Small businesses will buy, sell, deliver, install, and service these purchases.
To complement this full expensing, the Government will also temporarily allow companies with a turnover of up to $5 billion to offset tax losses against previous profits on which tax has been paid.
This will provide a targeted cash flow boost that businesses across the country desperately need.
Normally, businesses would have to return to profit before they can use their losses, however, these are not normal times.
Losses incurred to June 2022 can be offset against prior profits made in or after the 2018-19 financial year.
In order to keep their workers, these businesses need help now.
The Government is also providing $105 million in tax relief to expand access to a range of small business tax concessions by lifting the aggregated annual turnover threshold for these concessions.
Businesses with an aggregated annual turnover between $10 million and $50 million will, for the first time, be able to access up to ten small business tax concessions.
The expanded concessions will apply in three phases, with the first phase starting from 1 July 2020. The changes will reduce red tape and support around 20,000 businesses to attract workers and retain jobs.
The Government will also enhance previously announced reforms to invest an additional $2 billion through the Research and Development Tax Incentive. These changes will commence from 1 July 2021 and help more than 11,400 companies that invest in research and development to create the jobs of today and tomorrow.
Tax relief for hard-working Australians and businesses is part of the Government’s Economic Recovery Plan to create jobs, rebuild the economy and secure Australia’s future.
Source: 16 News http://www.16news.com.au/index.php/2020/10/06/tax-relief-to-back-hard-working-australians-and-to-create-more-jobs/