Timetable changes: annual tax update

Graw, Stephen (2007) Timetable changes: annual tax update. In: [Presented at] 2007 Taxation Institute of Australia North Queensland Convention. From: 2007 Taxation Institute of Australia North Queensland Convention, 18 - 19 May 2007, Cairns, QLD, Australia.

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[Extract] The major changes to our tax laws since May 2006 were undoubtedly those that were announced in the 2006 Federal Budget and which have been implemented since. They included changes to the personal tax regime, associated changes to the FBT regime and acceleration of the depreciation write-offs that were all included in the Taxation Laws Amendment (Personal Tax Reduction and Improved Depreciation Arrangements) Bill 2006. In particular, those changes:

a. reduced the 42% and 47% individual income tax rates, to 40% and 45% respectively from 1 July 2006;

b. increased individual income tax thresholds so that the 15% rate now extends(for resident taxpayers) up to $25,000, the 30% rate to $75,000, the 40% rate to $150,000 and the 45% rate to all income over$150,000;

c. in line with the reduction of the top marginal income tax rate, also reduced the FBT rate, the ultimate beneficiary non-disclosure rate and the family trust distributions tax rate to 46.5% to align those rates with the top individual marginal tax rate plus Medicare levy;

d. increased the low income tax offset from $235 to $600 and the threshold at which it starts to phase out from $21,600 to $25,000;

e. reduced the Medicare levy low income phase-in rate from 20% to 10%;

f. increased the threshold for the Senior Australian tax offset from $21,968 to $24,867 for single taxpayers and from $36,494 to $41,360 for couples;

g. increased the rate under which assets acquired after 9 May 2006 can be depreciated using the diminishing value method from a 150% base to a 200% base.

They also included the changes to the taxation of superannuation payments (whether taken as a lump sum or as an income stream) that were introduced in the Superannuation Legislation Amendment Act2007 (Cth) and associated legislation (collectively Acts 9 to 19 of 2007). In short, those changes make superannuation receipts that are paid from a taxed fund, tax-free in the hands of recipients over the age of 60 years. They also significantly simplify the taxation treatment of such receipts in the hands of both those under 60 but above the preservation age and those below the preservation age.

The third most significant set of changes was the “clean out” of obsolete provisions that had previously been announced by the Treasurer. The Tax Laws Amendment (Repeal of Inoperative Provisions) Bill2006 repealed over 4,100 pages of obsolete and/or inoperative tax law provisions and/or Acts.

In addition, the courts and the AAT continued to adjudicate disputes between the Commissioner and taxpayers and the Commissioner continued issuing Rulings, Taxation Determinations, ATOIDs and Practice Statements, all designed to provide greater certainty to the determination of tax liability. Some of the more important, more interesting or simply more quirky of those developments are dealt with in this paper.

Item ID: 53295
Item Type: Conference Item (Non-Refereed Research Paper)
Date Deposited: 09 May 2018 23:21
FoR Codes: 18 LAW AND LEGAL STUDIES > 1801 Law > 180125 Taxation Law @ 100%
SEO Codes: 94 LAW, POLITICS AND COMMUNITY SERVICES > 9499 Other Law, Politics and Community Services > 949999 Law, Politics and Community Services not elsewhere classified @ 100%
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