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Tax cuts, female-friendly policies loom in Morrison’s pre-election budget
The Morrison government is predicted to provide tax sweeteners for voters as well as look to shore up the female vote ahead of next year’s federal election, an industry expert has revealed.
Tax cuts, female-friendly policies loom in Morrison’s pre-election budget
The Morrison government is predicted to provide tax sweeteners for voters as well as look to shore up the female vote ahead of next year’s federal election, an industry expert has revealed.
Accounting firm BDO Australia is predicting the government will use the 11 May budget to provide sweeteners for taxpayers.
“The government will be looking to spend money on the policies that will help them win at the polls in 2022,” BDO tax partner Mark Molesworth said.
Mr Molesworth believes the Morrison government will include tax incentives as part of its budget recovery package.
“This year’s budget will be a ‘Push Me, Pull You’ scenario. The need for budget repair will push the government in one direction, but the whiff of an upcoming election will pull them in the other,” the tax partner said.
“However, there are likely to be tax sweeteners for voters, in particular personal tax rate cuts for middle-income earners, with more than 10 million Aussies earning under $120,000 due to face a tax hike from next financial year.”
Mr Molesworth predicts the first increase to superannuation is likely to go ahead, despite facing opposition from Liberal backbenchers.
“When it comes to superannuation, the chances of stopping the superannuation guarantee increase to 10 per cent on 1 July is very low, as the deadline is now too close. Instead, they may focus on reviewing the timetable for future increases and perhaps look at trading off other changes, such as the base on which contributions are made,” Mr Molesworth said.
Another major issue for the Liberal government is winning back the female and family-friendly vote following allegations of sexual misbehaviour from senior Liberal ministers.
Looking to bridge the widening divide between Canberran and Australian women, BDO said the government will zero in on “female-friendly proposals”.
It speculates superannuation will be paid on top of paternity leave to ease the wage gap and reduce the financial burden felt by mothers.
Mr Molesworth believes the heavily scrutinised aged care sector following the royal commission is likely to see a funding boost.
“Implementing aged care royal commission recommendations such as allowing people to stay in their homes longer and receive care there if they choose, rather than moving into a residential facility,” Mr Molesworth said.
The tax specialist is also predicting the Morrison government will look to act on climate change, following Biden’s climate summit.
“Prime Minister Scott Morrison recently commented that Australia was not going to meet its climate change targets through punishing taxes. Further investigation is needed on the continuation of the luxury car tax, which has had a direct impact on the uptake of electric vehicles,” Mr Molesworth concluded.
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