The Coalition’s ‘miracle’ win may not have been foreseen by the polls or the pundits, however either way the votes fell, the tax and superannuation landscape was up for change.

While the final make-up of Parliament gets ironed out (including who holds the balance of power particularly in the Senate) there are a few things we know will not happen. The following Labor policies will be assigned to the election scrap-heap:

  • increasing the income tax offset for low and middle income earners;

  • increasing the Budget repair levy;

  • abolishing negative gearing on investment properties;

  • reducing the CGT discount to 25% (from 50%);

  • abolishing refunds of franking credits;

  • taxing trust distributions at 30%;

  • capping the cost of managing tax affairs at $3,000;

  • capping interest deductions for multinationals at the world-wide gearing ratio;

  • no Second Commissioner for Appeals at the Australian Taxation Office; and

  • lowering thresholds for tax transparency and introducing added ‘black economy’ measures.

Additionally, this is a long list of legislation and reform proposals of the Coalition that effectively lapsed on calling the election, but which are now likely to be on the table or being carefully considered in Canberra over the coming months. These include:

  • the changes to Division 7A;

  • removing the main resident exemption for foreign residents (including expatriates);

  • the superannuation guarantee amnesty;

  • increasing the maximum SMSF members from 4 to 6;

  • the extension of director’s penalty notices to GST;

  • the introduction of director identification numbers;

  • changes to deductions associated with holding vacant land;

  • the taxation of licensing fame or image rights;

  • changes to the taxation of testamentary trusts;

  • research and development reforms; and

  • personal tax cuts.

For the private group and SME market, most attention will be focused on the status of the Division 7A reforms.

For more information:

Rod Payne
T: 03 5226 8541

Alasdair Woodford
Senior Associate
T: 03 5225 5217