Foreign investors in Australian residential property are facing tougher rules, including the removal of the main residence capital gains tax exemption, tightened compliance and a cap 50 per cent sales to foreigners in new developments. There will also be a “ghost tax” of at least $5000 per year on all foreign investors who fail to either occupy or lease their property for at least six months of the year.
Big banks will be hit with a levy on liabilities of $100 million or more from July 1, to reap $6.2 billion for the government over the next four years.
Mr Morrison said it was “similar to measures imposed in other advanced countries, and will even up the playing field for smaller banks”.
But any customer deposits of less than $250,000 would be exempt from the levy.
A simpler system for Australians to resolve disputes with banks will also be established.
Mr Morrison also said Australians needed to get a fairer system from banks.
“Banks will also be held to account if they try and hide misconduct by executives with new mandatory reporting requirements,” he said.
Smaller banks would face fines of $50 million and $200 million for larger banks if they breach misconduct rules.
Sure, Medicare is getting a boost — but you’ll be paying for it. The Budget will hit most workers hard, with a $8 billion tax grab.
The Government will increase the Medicare levy from 2 per cent to 2.5 per cent of taxable income from July 1, 2019 to fund the National Disability Insurance Scheme.
You’ll only be exempt if your income is below the threshold of $21,655 for singles, $36,541 for families and $34,244 for pensioners.
Other tax rates that are linked to the top personal tax rate, such as the fringe benefits tax rate, will also be increased.
The measure is predicted to make $8.2 billion revenue for the Government over four years.
University funding will be cut by $2.8 billion over four years. Students will face a 7.5 per cent tuition fee hike, phased in over four years starting in 2018.
The maximum increase for a four-year, government-subsidised degree will be $3600, with a maximum total cost of $50,000. A subsidised six-year medical degree will cost a maximum of $75,000.
Graduates will start repaying their loans at a lower income threshold of $42,000 instead of $51,957, high income earners (over $119,882) will pay 10 per cent of their income instead of eight per cent.
Income thresholds for repayment will be indexed to the consumer price index instead of the faster rising average weekly wages, meaning higher repayments to the government over the longer term.
Universities will have to meet a 2.5 per cent efficiency dividend, and their funding will depend on performance.
As well as previously announced changes to the 457 visa system, the government will also introduce a levy on businesses that employ foreign workers.
From March next year, the levy on foreign workers on certain skilled visas will go towards a new Skilled Australians Fund.
Small business will have to pay $1200 per year for a foreign worker, along with a one-off $3000 payment. Larger businesses would pay $1800 a year per worker, along with a one-off payment of $5000.
This is expected to bring in $1.2 billion over the next four years to go towards training Australian workers.
Former Parliamentarians will lose their cushy travel entitlements, with the life gold pass being abolished for everyone except former Prime Ministers.
The measure will save $2.6 million over five years by stripping former MPs of the taxpayer-funded business class travel they previously enjoyed at taxpayer expense.
Former Prime Ministers will retain access to the entitlement, in order to meet the commitments that arise from their continued standing and involvement in the community.
Banana smoothie-loving hipsters
Your fashionable banana smoothies and tea tree oil skincare could cost even more as the Government increases agricultural levies and export charges on the request of the sector.
From July, there will be a levy of 25 cents per kilogram of tea tree oil sold domestically or exported, and the levy on bananas will increase by just under 0.5 cents per kilogram.
Of course, there is a slim chance sellers will take pity on the needy and not increase the retail price.
Parents who don’t vaccinate their children will be $14-a-week worse off, with $28 set to be wiped from their family tax benefits every fortnight.
The measure, which will start from July 2018, is expected to raise $15 million over four years, while sending a tough message to those who fail or refuse to immunise their children.
Social Services Minister Christian Porter and Health Minister Greg Hunt said last week that reducing fortnightly payments instead of withholding the end-of-year supplement would serve as a constant reminder to parents to vaccinate their children.
If you’re on Centrelink, expect to be hit by a tough new regime aimed at saving $632 million over the five years from 2016-17.
A crackdown on unemployed Australians with drug and alcohol habits will include penalties for those who fail to turn up to appointments or work-for-the-dole placements due to intoxication, with payments to be reduced or cancelled.
Anyone who does not show up without a reasonable excuse will have their payment suspended until they “re-engage” with their job services provider, and demerit points will be accrued for each incident.
The measures include a drug testing trial of 5000 new welfare recipients, and new rules making drug addicts and alcoholics ineligible for disability pensions for medical conditions “caused solely by their own substance abuse”.
Those who test positive to illicit drugs will have their welfare payments placed onto a cashless debit card, which can only be used to pay for legitimate living expenses.
The government will further penalise claimants who miss appointments and fail to update their information by removing backdating provisions.
And a crackdown on single parents will target those who fraudulently collect multiple payments, with single-parent households to be subjected to closer scrutiny to verify their relationship status.
The Australian Taxation Office will be given $28.2 million to crack down on serious and organised crime in the tax system, extending an existing measure to 2021.
It’s hoped this will help claw back $408.5 million in revenue, meaning a net gain of $380.3 million over four years.
Spending on arts and cultural heritage will decrease by 2.6 per cent in real terms from 2016-17 to 2017-18, and by 12.0 per cent in real terms over the period 2017-18 to 2020-21.
This includes programs that support funding for the arts and cultural institutions, reflecting the implementation of efficiencies and arts-related savings measures from 2014-15 and 2015-16.
Developing countriesAustralia’s ever-shrinking foreign aid contribution will be cut by 16.9 per cent in real terms between 2016-17 and 2017-18 to $3.35 billion, and is forecast to decline by 3.4 per cent in real terms over the next four years to $3.6 billion in 2020-21.
Sweeping cuts to the foreign aid budget, which peaked at $5.6 billion in 2012-13, were initiated by the Abbott government in 2014, plunging Australia down the world generosity rankings and bringing total aid as a proportion of gross national income fall to its lowest level in the nation’s history.
The war on durries continues. Roll-your-own tobacco and cigars will soon be more expensive under a plan to bring their tax treatment in line with pre-made cigarettes. The change will be phased in over four years from 2017 to 2020, to coincide with the existing annual 12.5 per cent tobacco tax increases which occur on 1 September each year. The move is expected to claw an extra $360 million in tax revenue from Australia’s brown, stained fingers over the next four year.