Following the 2014 Federal Budget handed down on Tue 13.5.2014, the Tax Laws Amendment (Temporary Budget Repair Levy) Bill 2014 along with 14 additional supporting Bills were introduced into the House of Representatives.
The Bills propose to amend the ITAA 1997, the Income Tax Rates Act 1986, the Income Tax (Transitional Provisions) Act 1997 and other taxation imposition and ratings Acts to introduce a 3-year progressive budget repair levy in the primary form of additional income tax on Australian resident and foreign resident individuals commencing in the 2014-15 financial year.
The temporary budget repair levy will also be reflected in a number of tax rates that are currently based on the top personal marginal tax rate (45%), as well as those based on a calculation comprising the top personal rate and the Medicare levy (currently 1.5%, but legislated to increase to 2% from 1 July 2014), to maintain the integrity and ensure the fairness of the tax system, and minimise opportunities for avoiding the levy.
The levy will be payable at a rate of 2% of each dollar of a taxpayer’s annual taxable income over id=”mce_marker”80,000. No levy is payable where the taxpayer has a taxable income of id=”mce_marker”80,000 or less except in cases where a tax law integrity rule applies the top personal marginal tax rate as a flat rate to certain types of income.
The 14 additional supporting Bills include:
- 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 (Interest on Non-Resident Trust Distributions) (Temporary Budget Repair Levy) Bill 2014;
- Tax Laws Amendment (Untainting Tax) (Temporary Budget Repair Levy) Bill 2014; and
- Trust Recoupment Tax Amendment (Temporary Budget Repair Levy) Bill 2014.
DATE OF EFFECT: The levy is proposed to be payable with respect to the 2014-15 financial year and the next 2 financial years.
[LTN 91, 14/5/14]
Temporary Budget Repair Levy Bills referred to Senate committee for report by 16 June
The package of 15 Temporary Budget Repair Levy Bills has been referred to the Senate Economics Legislation Committee for report by 16 June 2014. The Bills, which are still before the House of Reps, propose to amend the ITAA 1997, the Income Tax Rates Act 1986, the Income Tax (Transitional Provisions) Act 1997 and other taxation imposition and ratings Acts to introduce a 3-year progressive budget repair levy in the primary form of additional income tax (at 2%) on Australian resident and foreign resident individuals commencing in the 2014-15 financial year.
[LTN 93, 16/5/14]
Temporary Budget Repair Levy: package of 15 Bills passes House of Reps
The Tax Laws Amendment (Temporary Budget Repair Levy) Bill 2014 along with 14 additional supporting Bills have passed the House of Reps on Wed 28.5.2014, without amendment, and will now move to the Senate.
[LTN 101, 28/5/14]