On 11 May 2021, Treasurer Josh Frydenberg handed down his second “pandemic budget” amidst a backdrop of continuing uncertainty. Acknowledging that the virus is a continuing threat to lives and livelihoods, this budget is again framed to prioritise jobs and investment.
The focus is on structural reforms across many of the government portfolios. Skills, infrastructure, deregulation, and digital transformation are all featured, together with a continued emphasis on services.
The key announcements include:
- Underlying cash deficit forecast to reach $106.6 billion in 2021-22
- The low and middle income tax offset to be extended to 2021-22
- Individual tax residency rules reformed to a ‘bright line’ 183 day test
- A new patent box regime introduced
- Temporary Full Expensing extended to 30 June 2023
- Loss Carry Back extended for losses in 2022-23 year
- Childcare made more affordable to reduce barriers to work
- Women’s Statement returns; targets safety and economic security
- Record investment in health and essential services
- Infrastructure focus on productivity, national freight & supply chains
To view our analysis of the Federal Budget 2021-22 and a deep dive into the specific taxation and superannuation announcements please click here.
Please do not hesitate to reach out if you wish to discuss any of the points raised in this Alert.