TAXATION – GOVERNMENT POLICY – AUSTRALIA

Turnbull on the verge of tax victory

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Original article by Simon Benson, Joe Kelly
The Australian – Page: 1 & 6 : 23-Mar-18

One Nation has agreed to back the Federal Government’s company tax cuts package in return for a commitment to a pilot program for taxpayer-subsidised apprenticeships. The Government still requires the support of independent senators Tim Storer and Derryn Hinch, with the latter advising that he will back the tax package provided that it does not apply to the four major banks. Liberal Democrat David Leyonhjelm has vowed to withdraw his support for the tax cuts if the Government agrees to Hinch’s demands. Meanwhile, Labor has signalled that it may seek to reverse any reduction in the tax rate for larger companies if it wins the next election.

CORPORATES
ONE NATION PARTY, LIBERAL DEMOCRATIC PARTY, AUSTRALIAN LABOR PARTY, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, AUSTRALIA. DEPT OF FINANCE, NATIONAL PARTY OF AUSTRALIA, ACTU

Tax cut will lift wages: CEOs’ push

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Original article by Ben Packham
The Australian – Page: 1 & 4 : 22-Mar-18

Ten of the nation’s largest companies have committed to increasing their investment in Australia if the Federal Government progressively reduces the corporate tax rate from 30 per cent to 25 per cent. They argue that increased investment will in turn result in the creation of more jobs and ultimately boost wages. Meanwhile, independent senator Steve Martin has agreed to support the Enterprise Tax Plan Bill, although fellow independent Tim Storer has yet to decide his position. The Government requires the support of nine Senate crossbenchers.

CORPORATES
BUSINESS COUNCIL OF AUSTRALIA, BHP BILLITON LIMITED – ASX BHP, WOOLWORTHS GROUP LIMITED – ASX WOW, WESFARMERS LIMITED – ASX WES, QANTAS AIRWAYS LIMITED – ASX QAN, ENERGYAUSTRALIA PTY LTD, FORTESCUE METALS GROUP LIMITED – ASX FMG, ORIGIN ENERGY LIMITED – ASX ORG, MYOB GROUP LIMITED – ASX MYO, JBS AUSTRALIA PTY LTD, WOODSIDE PETROLEUM LIMITED – ASX WPL, AUSTRALIA. DEPT OF FINANCE, ONE NATION PARTY, NICK XENOPHON TEAM, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, AUSTRALIAN LABOR PARTY

Hanson ponders tax cuts switch

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Original article by Ben Packham
The Australian – Page: 4 : 21-Mar-18

One Nation leader Pauline Hanson has indicated that she may be open to backing the Federal Government’s company tax cuts package. Hanson notes that many companies in the US are hiring additional staff in the wake of the corporate tax reforms of President Donald Trump. The Nick Xenophon Team, which boasts two senators, opposes the tax cuts, which will require the Government to gain the support of the other nine crossbench senators for its tax bill.

CORPORATES
ONE NATION PARTY, NICK XENOPHON TEAM, UNITED STATES. EXECUTIVE OFFICE OF THE PRESIDENT, AUSTRALIAN TAXATION OFFICE, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, RIO TINTO LIMITED – ASX RIO, COMMITTEE FOR ECONOMIC DEVELOPMENT OF AUSTRALIA, AUSTRALIA. DEPT OF FINANCE, FORTESCUE METALS GROUP LIMITED – ASX FMG, WOODSIDE PETROLEUM LIMITED – ASX WPL

Flaw in Shorten’s $2.5m cash refund claim exposed

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Original article by Joe Kelly
The Australian – Page: 1 & 4 : 21-Mar-18

SMSF Association chair Deborah Ralston says that contrary to claims by Opposition Leader Bill Shorten, relatively few self-managed superannuation funds receive $A2.5m worth of cash refunds for excess dividend imputation credits each year. She adds that SMSFs would need to hold at least $A100m worth of Australian shares that pay fully franked dividends to qualify for such cash refunds. Prime Minister Malcolm Turnbull has accused Shorten of targeting people on low incomes.

CORPORATES
SMSF ASSOCIATION, AUSTRALIAN LABOR PARTY, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, AUSTRALIA. DEPT OF THE TREASURY, RICE WARNER ACTUARIES PTY LTD, AUSTRALIAN TAXATION OFFICE

Cormann presses crossbench on tax cuts

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Original article by Joe Kelly
The Australian – Page: 4 : 20-Mar-18

Finance Minister Mathias Cormann says the Federal Government’s corporate tax cuts are needed to ensure that Australian businesses are internationally competitive. The Government will seek the Senate crossbenchers’ support for the tax package ahead of the May 2018 Budget, and it will require nine of them to vote in favour of the bill. The Nick Xenophon Team opposes the tax cuts, while One Nation leader Pauline Hanson is not convinced that reducing the tax rate for all companies to 25 per cent will result in higher growth in wages.

CORPORATES
AUSTRALIA. DEPT OF FINANCE, NICK XENOPHON TEAM, ONE NATION PARTY, LIBERAL DEMOCRATIC PARTY, AUSTRALIAN LABOR PARTY, AUSTRALIAN GREENS

Hit black economy and raise billions

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Original article by Adam Creighton
The Australian – Page: 21 : 20-Mar-18

A report from KPMG concludes that targeting the black economy could generate revenue of at least $A5.8bn for the Federal Government. This includes an extra $A2.5bn in business taxes and an additional $A1.2bn in goods and services tax revenue. KPMG’s recommendations include banning income tax deductions for wages paid in cash and prohibiting cash transactions of more than $A100,000. The Government’s May 2018 Budget is expected to include its response to the final report of a black economy taskforce.

CORPORATES
KPMG AUSTRALIA PTY LTD, AUSTRALIAN TAXATION OFFICE, AUSTRALIAN LABOR PARTY, RESERVE BANK OF AUSTRALIA

Future Fund exempt from Labor tax plan

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Original article by Jacob Greber
The Australian Financial Review – Page: 3 : 16-Mar-18

Shadow treasurer Chris Bowen has advised that the Federal Government’s Future Fund will be exempt from Labor’s proposed changes to the dividend imputation system. He says exempting the sovereign wealth fund from the reforms will have no net impact on the Budget, while adding that the fund’s ability to meet future public sector pension liabilities could have been affected if it were denied access to cash refunds for unclaimed dividend imputation credits.

CORPORATES
AUSTRALIAN LABOR PARTY, AUSTRALIA. FUTURE FUND MANAGEMENT AGENCY, AUSTRALIA. DEPT OF FINANCE, AUSTRALIA. PARLIAMENTARY BUDGET OFFICE

Shorten in scramble to fix tax grab

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Original article by Simon Beavis
The Australian – Page: 1 & 6 : 15-Mar-18

Federal Opposition Leader Bill Shorten has signalled that he is open to a compromise regarding plans to unwind changes to the dividend imputation system, amid concern about the potential impact on retirees. Shorten has conceded that about 250,000 pensioners would be affected by the policy, and he has indicated that Labor will look at measures to ensure that they are not worse off. The Self-Managed Super Fund ­Association and seniors groups have urged Labor to reconsider the policy, while Prime Minister Malcolm Turnbull has accused Labor of targeting pensioners and self-funded retirees in a "cash grab".

CORPORATES
AUSTRALIAN LABOR PARTY, SMSF ASSOCIATION, NATIONAL SENIORS AUSTRALIA LIMITED, ASSOCIATION OF INDEPENDENT RETIREES (AIR) LIMITED, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, AUSTRALIA. DEPT OF HUMAN SERVICES. CENTRELINK

Tax grab to hit lowest incomes

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Original article by Simon Benson, Joe Kelly
The Australian – Page: 1 & 6 : 14-Mar-18

The Federal Opposition claims that abolishing cash refunds for excess dividend imputation credits would primarily affect wealthy individuals and members of self-managed superannuation funds. However, analysis by the Treasury suggests that people whose annual income is less than $A18,200 would be hardest hit, which is estimated to be about 610,000 individuals. In contrast, the reforms would only affect about 5,000 people with annual income of more than $A180,000. Treasurer Scott Morrison has warned that the policy would affect more than a million Australians, including 230,000 pensioners, while the wealthy would continue to gain the full value of their franking credits.

CORPORATES
AUSTRALIAN LABOR PARTY, AUSTRALIA. DEPT OF THE TREASURY, FINANCIAL SERVICES CONSUMER POLICY CENTRE INCORPORATED, SMSF ASSOCIATION, AUSTRALIA. DEPT OF FINANCE, AUSTRALIAN TAXATION OFFICE, CHIFLEY RESEARCH CENTRE

Labor to cut dividends cash refund

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Original article by Phillip Coorey
The Australian Financial Review – Page: 1 & 2 : 13-Mar-18

Opposition Leader Bill Shorten will unwind changes to the dividend imputation system that were introduced by the Coalition in 2000 if Labor wins the next federal election. The move would affect around 1.2 million taxpayers and about 200,000 members of self-managed superannuation funds, who would no longer be entitled to receive a cash refund for excess dividend imputation credits. Shorten has emphasised that nobody will pay more tax as a result of the changes, while Australians will still be able to reduce their tax via dividend imputation. The policy is forecast to boost government revenue by $A59bn over the next decade.

CORPORATES
AUSTRALIAN LABOR PARTY, KPMG AUSTRALIA PTY LTD, AUSTRALIA. PARLIAMENTARY BUDGET OFFICE