The Federal Treasurer announced today that the Government will
not proceed with a number of proposed initiatives which had been
announced by the former Labor Government as part of the 2013-14
Among the initiatives which have been discontinued are:
Offshore Banking Unit – the Government
will not proceed with the part of this measure that excludes
all related party transactions but have a targeted integrity
measure to provide certainty for the industry. This should
help Australian banks compete on a level playing field
overseas, through access to a competitive tax rate, and
attract activity to their Australian operations. Consultation
with stakeholders in the industry will be undertaken soon to
develop targeted rules to address the integrity issues with
the current rules in this area.
Tax on Superannuation Pensions – this
proposed initiative which would have taxed people's
superannuation pension earnings above $100,000 in the draw-down
phase will not be implemented due to the expected compliance
Self-Education Expenses Cap – the
proposed cap of $2000 will not be implemented.
$1.8 billion Fringe Benefits Tax hit on the car
industry – the abolition of this proposed initiative
that would have made it harder for people to have a company or
salary sacrificed vehicle was part of the election campaign for the
Coalition and today it has confirmed it will not proceed.
The Federal Government will however proceed with a number of
other proposed measures including:
Managed Investment Trusts – the new
tax regime for Managed Investment Trusts (MITs) along with the
third tranche of the Investment Manager Regime will proceed on the
basis that these measures will make Australia's financial
services industry more attractive in foreign markets by
establishing MITs in their own right with a transparent framework,
aimed at driving demand.
Farm finance – the non-primary
production income eligibility threshold for Farm Management
Deposits will be increased from $65,000 to $100,000.
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