13/10/2020
What you need to know
> The Budget is forecast to result in a record deficit peaking at $966 billion (44% of GDP) in 2024. However, thanks to record low interest rates, this comes with only a minimal increase in interest payments.
> Jobs are the Government’s primary focus — creating jobs and keeping jobs, with the introduction of the JobMaker plan (including a $100-$200 per week hiring credit for eligible employees/employers and reimbursement of up to 50% of an apprentice’s training) and the JobTrainer fund.
> Tax cuts will play a major role and, unlike other economic downturns, there will be no deficits tax on high income earners. Stage 2 personal income tax cuts are to be brought forward 2 years, backdated to 1 July 2020, with tax savings for around 7 million Australians of $2,000 or more.
> Business Owners will be able to carry back tax losses from the 2019/20, 2020/21 and 2021/22 financial years to offset previously taxed profits in the 2018/19 or later financial years. This, coupled with the Instant Asset Write-off provisions and expanded access to tax concessions for small business, is calculated to generate spending and create jobs.
> Superannuation measures called ‘Your Future, Your Super’ include a stronger focus on reducing fees and costs by increasing transparency and reducing the incidence of individuals with multiple super funds.
This information is issued by Millennium3 Financial Services Pty Ltd (M3) ABN 61 094 529 987, which holds Australian Financial Services Licence Number 244252 and is a summary of M3’s understanding of the proposed Federal Budget 2020/21 changes announced on 6 October 2020. M3 is a company within the IOOF Group of companies, consisting of IOOF Holdings Limited ABN 49 100 103 722 and its related bodies corporate. The changes are subject to the passing of legislation and, accordingly, may not become law or may change. Please note that the information is based on M3’s interpretation of the proposed changes as at the date of issue of this document. Accordingly, you must not do or refrain from doing anything in reliance on this information without obtaining suitable professional advice.
