The Liberal National Party coalition budget for 2022-23 was handed down on Tuesday, 29th March 2022 by Federal Treasurer Josh Frydenburg.
The Government’s Budget papers have been published here, Budget Paper No. 2.
and Treasury Laws Amendment (Cost of Living Support and Other Measures) Bill 2022
The text of the Treasurer’s speech is here.
Included in the budget measures:
Low & Middle Income Earners Offset Temporary Increase
Middle income earners currently getting the $1,080 LMITO will have that increased by $420 (to $1,500) for the current 2021-22 financial year.
The Low Middle Income Tax Offset becomes payable at the time of tax return assessment, and so will flow to taxpayers from July 2022 onwards.
$250 Cost Of Living Payment
Welfare recipients including pensioners will receive an one-off $250 cost of living payment “within weeks“.
The payment will be exempt from tax and not be counted as income support for the purposes of any income support payment.
The full list of beneficiaries:
• Age Pension
• Disability Support Pension
• Parenting Payment
• Carer Payment
• Carer Allowance (if not in receipt of a primary income support payment)
• Jobseeker Payment
• Youth Allowance
• Austudy and Abstudy Living Allowance
• Double Orphan Pension
• Special Benefit
• Farm Household Allowance
• Pensioner Concession Card (PCC) holders
• Commonwealth Seniors Health Card holders
• eligible Veterans’ Affairs payment recipients and Veteran Gold card holders
Beneficiaries eligible under more than one category will only be entitled to one payment.
Expansion Of Paid Parental Leave
Paid parental leave and the Dad and Partner Pay support schemes will be merged and available on a family basis for a total of 20 weeks paid leave (previously 18 weeks for PPL).
Single parents will also be included.
The income test will be broadened to include an additional household income eligibility
test.
The announcement asserts that the “changes will not result in any existing eligible claimants being worse off.
Parents can take leave any time within 2 years of the birth or adoption of their child.
For further information on Parental Leave measures see Services Australia website (Note: budget content not updated at this time of writing).
Fuel Excise Halved For 6 Months
Fuel excise will be temporarily halved for a period of 6 months from 30 March 2022. The Treasurer stated that this will reduce the price of petrol by 22 cents a litre.
This will also mean that Fuel Tax Credits for heavy vehicles on public roads will be reduced to zero in respect of that claim period.
Skills, Training and Technology 20% Deduction Boost For Small Businesses
[Note: This measure was not enacted by the LNP government before losing office in the May 2022 election. The Labor government has since announced that the measures will proceed, and when enacted, will take effect from 29 March 2022 until 30 June 2024.]
Draft legislation and explanatory materials have been released for comment. See:
- Skills and Training Boost – to 30 June 2024
- Technology Investment Boost – to 30 June 2023
A skills and training “boost” in the form of an additional 20% tax deduction on the costs of eligible employee training, and for the uptake of digital technologies, will be available for small businesses with aggregated annual turnover of less than $50 million to apply from budget night 29 March 2022.
The 20% boost for 2021-22 costs will be claimable in the 2022-23 tax return.
Boost elements for skills and training incurred in the 2022-23 and 2023-24 years will be claimable in the year incurred.
Eligible technology investment costs include business expenses and depreciating assets that support digital adoption, such as portable payment devices, cyber security systems or subscriptions to cloud-based services.
There is an annual cap of $100,000 on each year’s eligible expenditure until 30 June 2023.
Claims arising in 2021-22 will be included in tax returns for 2022-23.
Claims arising in 2022-23 will be claimable within the same year.
For progress on the legislation through parliament, see Treasury Laws Amendment (2022 Measures No 4) Bill 2022
Retirees’ Minimum Super Draw-down Rates
The current 50% reduction of drawdown rates for account-based pensions is extended for a further year until 30 June 2023.
The drawdown rates are listed here.
Primary Producers’ Carbon Credits Concessionary Treatment Extended
The proceeds from the sale of Australian Carbon Credit Units (ACCUs) and biodiversity certificates generated from on-farm activities to be treated as primary production income for the purposes of the Farm Management Deposits (FMD) scheme and tax averaging from 1 July 2022.
Aged Care Workers Cash Bonus
Aged care workers in residential aged care and home care to receive bonuses of up to $800 over 2 years from 2021-22.
Patent Box Measures Expanded
[Note: This measure was not enacted by the LNP government which lost office in the May 2022 election and is therefore subject to consideration of the incoming Labor government.]
The patent box measures announced in the 2021-22 Budget and currently before Parliament are to be expanded apply from 11 May 2021 and to support:
practical, technology-focused innovations in the Australian agricultural sector; and
the Government’s technology-focused approach to reducing emissions in line with the Government’s target to achieve net zero emissions by 2050.
See commentary:
- The Patent Box Scheme : Access a Lower Corporate Tax Rate – Clifford Gouldson Lawyers
- Patent Box – extension to the Agricultural and Low Emissions Technologies sectors – ATO
Covid 19
Previous announcements have been confirmed in respect of payments from various state and territory business support programs which are to be non-assessable non-exempt income until 30 June 2022; and..
..the costs of COVID-19 tests in order to attend a place of work are tax deductible for individuals from 1 July 2021 and likewise FBT will not apply.
Expanded Access To Employee Share Schemes & Red Tap Reduction
“Where employers make larger offers in connection with employee share schemes in
unlisted companies, participants can invest up to:
- $30,000 per participant per year, accruable for unexercised options for up to 5 years,
plus 70 per cent of dividends and cash bonuses; or - any amount, if it would allow them to immediately take advantage of a planned sale
or listing of the company to sell their purchased interests at a profit.
The Government will also remove regulatory requirements for offers to independent
contractors, where they do not have to pay for interests.“
Medicare Levy Low-Income Thresholds
The customary annual increase in medicare levy low income eligibility thresholds have been announced:
- Single seniors and pensioners threshold: increases from $36,705 to $36,925.
- Family threshold for seniors and pensioners: increases from $51,094 to $51,401
- Singles threshold increases from $23,226 to $23,365.
- Family threshold increases from $39,167 to $39,402
Each dependant child or student increases the family income thresholds by a further $3,619 (previously $3,597).
Digitalised Trust Returns
Trust and beneficiary income reporting and processing will allow trust tax return filers the option to lodge income tax return electronically, thereby permitting more pre-filling and the automation of ATO’s assurance processes.
The measure will commence from 1 July 2024, subject to advice from software providers
about their capacity to deliver.
Budget Summaries & Commentary
2022 Budget Speech In Full – Minister Josh Frydenberg (29 March 2022)
The Leader of The Opposition Budget Address-in-reply (31 March 2022)
Confirmed: Federal Election 21 May 2022
The Federal election will be conducted on Saturday 21 May 2022.
- 2022 federal election information and key dates: Australian Electoral Commission.
- The status of unenacted measures of the 46th Parliament are summarized in the article here: 46th session of Parliament is almost over.
- See also: Pre-election Economic and Fiscal Outlook 2022 “PEFO” issued by The Treasury.
Unfinished Business
A number of announced measures remain unenacted as a result of the ending of the 46th Parliament ahead of the general election.
See:
This page was last modified 2022-11-23