2020/2021 Federal Budget
The Federal Treasurer, Mr Josh Frydenberg, handed down the 2020/21 Federal Budget at 7:30 pm (AEDT) on 6 October 2020.
Australia’s economic response to the COVID-19 pandemic in the form of the original and extended JobKeeper scheme, the cashflow boosts and the enhanced JobSeeker payment has come at a significant cost, Mr Frydenberg said, resulting in a budget deficit of $213.7b, falling to $66.9b by 2023/24.
The government has proposed to bring forward by two years individual tax cuts legislated to start in 2022/23, meaning as of the 2020/21 income year the 19% threshold will be lifted from $37,000 to $45,000 and the 32.5% threshold lifted from $90,000 to $120,000. The low and middle income tax offset will also be retained for an additional year.
The Budget has been described as an economic recovery plan which is “all about jobs” — with the introduction of a new JobMaker Hiring Credit scheme designed to give businesses incentives to take on additional young people seeking jobs. In a major boost to business investment, immediate deductions for asset purchases of any value will be available to businesses with a turnover of up to $5b, until June 2022. Other measures include further refinement of proposed changes to the R&D incentive, FBT and CGT exemptions.
Click here to download a summary of the budget's tax and superannuation highlights.