The State and Federal Governments delivered their 2018 Budgets recently. Not many of us have the time or inclination to sift through the hundreds of pages of government-speak to discover how we might win or lose, so here’s a quick guide to some of the key positives and negatives.
OUR SYNOPSIS: There was some media hype about tax cuts for low income earners and how that was just a smoke-screen to mask the benefits being afforded to big multinationals. Whatever the case, it’s the same story that gets bandied about every time a Federal Budget is handed down. The fact is that if you’re a low-income earner, any sort of break will come as welcome relief even if it is offset by increased costs elsewhere. And if you’re a multinational corporation, you’ll always have the ability to influence government outcomes. So nothing really changes in that regard.
But there was a handful of potential benefits and one or two areas that could be of concern.
SMALL BUSINESS: The $20,000 instant asset write-off has been extended for a further 12 months to 30 June 2019, so good news if you’ve got any big capital purchases up to that amount planned.
SUPERANNUATION: If you’re relatively new to super or have been lax in paying your own, the good news is that for account balances less than $6,000, a 3 per cent cap on annual fees has been introduced. And while it’s not good news for super funds, the great news for retirees is that exit fees are to be banned. As for lost super and inactive accounts, those containing less than $6,000 will be automatically transferred to the ATO, which will seek to find owners and transfer to active accounts. There’s also a plan to force all super funds to offer “whole of life” products – or annuity-style accounts designed to make people’s super last for the rest of their lives. For more information, CLICK HERE to see Cbus Super’s useful fact sheet.
CASH PAYMENTS: Bad news if you’ve established your own cash economy as a means of “tax minimisation” – from 1 July 2019, a new $10,000 limit on cash payments will apply. There’ll also be more funding allocated to auditing to crack down on tax avoidance and money laundering.
CRAFT BEER: But great news for craft beer drinkers, with the price set to fall from next year due to a concession on the excise applied to small kegs.
BIGGER PICTURE: A rolling 10-year plan for infrastructure spending was announced, with $2.7 billion allocated to projects in WA. That will obviously be allocated to matters of federal concern, such as major roads and railways, but it’s on top of State Government funding for other projects – see below for further details.
OUR SYNOPSIS: You’ll be hard-pressed to find too much good news at the micro-level, unless you’re working on regional projects that benefit from the ongoing $1 billion a year allocated to Royalties for Regions. But take it up to an industry level and the news is slightly more rosy.
REGIONAL WATER PROJECTS: A decent chunk of the State’s piggybank ($556 million to be precise) has been allocated to projects that should have a knock-on effect for some plumbers. For example, $27 million goes towards connecting Harris and Stirling Dams to help secure long-term water supply to 44 towns in the Great Southern, which should lead to new and upgrade work down the track.
EDUCATION AND HEALTH: With $215 million going towards new and upgraded schools, as well as $202 million for redevelopment and expansion of health facilities (predominantly focused in regional WA), there’ll be new work opportunities across the gamut of plumbing and gas fitting in coming years.
BUILDING AND CONSTRUCTION TRAINING FUND: Miners will no longer be exempt from the BCITF levy, adding an expected $25 million to training over the next four years.
AT HOME: The average household will pay an extra $292 a year for utilities and other government fees.
GONE FISHING: If you like to wet a line, licence fees for recreational fishers are set to increase an additional $5. Of course, given the price of fresh fish seems to be permanently increasing, it’s still not a bad deal if you can catch your bag limit.
BIGGER PICTURE: Treasurer Ben Wyatt says ongoing constraint in spending should see the State back to surplus by in 2020/21. If the plan comes to fruition, the knock-on consequences should mean better times ahead for small business owners.