1. Childcare
The government couldnt wait till tonight to announce its $3.5 billion cash splash on childcare, choosing instead to announce the changes on Mothers Day. Families earning between $65,000 and $170,000 per annum will be $1500 better off each year from July 2017. The changes, which mean childcare centres receive a single payment to reduce parents upfront costs, are designed to encourage mothers to re-enter the workforce sooner.
2. Paid parental leave crackdown
Parents will no longer be allowed to access the taxpayer-funded paid parental leave scheme if their employer offers its own paid leave scheme. This means that almost 80,000 new parents will lose some or all of their parental leave payments. Parents who will miss out on the 18-week minimum wage scheme will be $11,538 worse off. Treasurer Joe Hockey said yesterday that government modelling showed higher-income earners were double dipping into parental leave schemes, which he said was just plainly unfair.
3. The Netflix Steam tax
People who buy movies, music, games and e-books online will be slugged an extra 10 per cent, with the government vowing to extend the goods and services tax to these intangible digital products. So, Netflix binge-watchers, be prepared to pay a little more. Mr Hockey said he would introduce draft legislation with the Budget, aimed at levelling the playing field. Its plainly unfair that a supplier of digital products into Australia is not charging the GST while some locally are charging the GST, he told reporters in Canberra yesterday. This measure is expected to raise $350 million over the next four years, all of which will go to the states.
4. Pensions
Eligibility rules for the age pension will be tightened, which is expected to push 91,000 people off the pension and see another 235,000 peoples payments reduced. The part-pension assets test will be cut to $820,000 for couples.
5. Multinational companies on notice
Mr Hockey has plans to crack down on multinational companies that dodge their tax obligations in Australia, announcing plans to recover billions in unpaid taxes and harsh new anti-avoidance fines. The treasurer said the government had in its sights 30 companies that divert their profits offshore to avoid paying tax in Australia. Companies that are caught doing the wrong thing will be forced to cough up their unpaid taxes and be could pay 100 per cent of that amount again in fines. Obviously, they have not been paying their fair share of tax in Australia. In fact, theyve been paying no tax in Australia, Mr Hockey said. Have no doubt the rest of the world is looking at this legislation.
Heres what else you can expect from tonights Budget:
● No surplus: Falling iron ore prices have put a Budget surplus out of reach
● Big spending on infrastructure: Western Australia will be among the biggest winners, with a one-off $499 million payment for nine infrastructure programs already on the record
● Medical research: Health savings will help fund a Medical Research Future Fund, which will have an initial injection of $10 billion.
