Federal Budget Deficit Levy Expected to Pass Parliament

With the Federal Parliament heading into its last sitting period before the current Senate expires, the temporary budget deficit levy bills are expected to pass with the support of the Greens and independent Senator Nick Xenophon.

The Package of Budget Bills

As previously mentioned in TimeBase, the budget bills consist of:

• Tax Laws Amendment (Temporary Budget Repair Levy) Bill 2014
• Income Tax Rates Amendment (Temporary Budget Repair Levy) Bill 2014
• Family Trust Distribution Tax (Primary Liability) Amendment (Temporary Budget Repair Levy) Bill 2014
• Fringe Benefits Tax Amendment (Temporary Budget Repair Levy) Bill 2014
• Income Tax (Bearer Debentures) Amendment (Temporary Budget Repair Levy) Bill 2014
• Income Tax (First Home Saver Accounts Misuse Tax) Amendment (Temporary Budget Repair Levy) Bill 2014
• Income Tax (TFN Withholding Tax (ESS)) Amendment (Temporary Budget Repair Levy) Bill 2014
• Superannuation (Departing Australia Superannuation Payments Tax) Amendment (Temporary Budget Repair Levy) Bill 2014
• Superannuation (Excess Non-concessional Contributions Tax) Amendment (Temporary Budget Repair Levy) Bill 2014
• Superannuation (Excess Untaxed Roll-over Amounts Tax) Amendment (Temporary Budget Repair Levy) Bill 2014
• Taxation (Trustee Beneficiary Non-disclosure Tax) (No 1) Amendment (Temporary Budget Repair Levy) Bill 2014
• Taxation (Trustee Beneficiary Non-disclosure Tax) (No 2) Amendment (Temporary Budget Repair Levy) Bill 2014
• Tax Laws Amendment (Untainting Tax) (Temporary Budget Repair Levy) Bill 2014
• Tax Laws Amendment (Interest on Non-Resident Trust Distributions) (Temporary Budget Repair Levy) Bill 2014
• Trust Recoupment Tax Amendment (Temporary Budget Repair Levy) Bill 2014.

 The 2 per cent tax increase on those earning more than $180,000 per year will apply from July 1 this year and is projected to raise more than $3 billion over four years.

Labor initially opposed the lifting of income tax rates temporarily, but agreed to the measure when it was revealed in the budget that it would only affect high-income earners. However, Labor is criticising the Government for delaying other, more-contested budget measures, like changes to a range of family payments.

Double Dissolution Trigger Also Proposed by Greens

The Greens are also vowing to provide the Prime Minister with a double dissolution trigger by the end of the parliamentary sitting fortnight. Party leader Christine Milne says she is determined to bring on a second vote on the abolition of the Clean Energy Finance Corporation (CEFC) which funds investment in renewable technologies.

The CEFC was established by the former Labor government. The Coalition Government's legislation to dismantle it was defeated in December last year. The current Senate has only two more weeks left before it expires at the end of June and the Greens and Labor would combine to block the bills once more if successful in bringing it to a vote.

That would give Prime Minister Tony Abbott a trigger which he could use to call a double dissolution election.

TimeBase is an independent, privately owned Australian legal publisher specialising in the online delivery of accurate, comprehensive and innovative legislation research tools including LawOne and unique Point-in-Time Products.

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