Tuesday, June 9, 2015
What's behind the scene
Labor has agreed with the government on another tax increase - removing a tax break for people whose spouses don’t work - following secret negotiations over measures stalled in the Senate since last year’s federal budget.
Sources said the opposition will back the abolition of the Dependent Spouse Tax Offset, which will save the budget about $300 million over four years and about $600 million over a decade.
The policy enables taxpayers to claim an offset of up to $2400 if their spouse has an adjustable income of less than $10,422.
The Abbott government tried to scrap the offset in the 2014 budget but it was one of the measures the Senate refused to pass.
Its abolition is now included in a miscellaneous tax bill recently introduced to Parliament and will pass before July 1 with Labor’s support.
AFR Weekend revealed on Saturday that Labor had also agreed to stop a legislated increase to the the tax-free threshold from $18,200 to $19,400 due to start on July 1. That will save almost $3 billion over four years and $7.7 billion over a decade.
Monday, August 30, 2010
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http://www.crosstax.com.au/Document/PIS_Successful_Investing_Issue3_2010.pdf
Thursday, April 22, 2010
Tax boss explains refund delays
STEPHEN JOHNSON April 22, 2010 - 2:34PM
AAP
The tax commissioner has fronted a parliamentary hearing to explain how a computer glitch caused 140,000 Australians to miss out on tax refund cheques.
Michael D'Ascenzo admitted the Australian Taxation Office's performance standards had dropped during an $824 million technology upgrade.
"With a system deployment as large as this some transitional issues are unavoidable," he told a parliamentary hearing in Canberra.
"Our performance against service delivery standards has dipped in the face of increasing workloads."
But Mr D'Ascenzo told an earlier public accounts and audit committee that the transition to a new computer system had not been a catastrophic failure.
"I don't think you can justifiably say the system is not working," he said.
"It's the sort of issues you'd expect from the implementation."
Opposition assistant treasury spokeswoman Sussan Ley, however, told the commissioner the delay in getting refund cheques to taxpayers was a sign the tax office would struggle to implement future tax reforms.
"There's something Monty Python-esque about you saying the system is working well," she said.
"People have described it as a debacle, as a disaster, as unmanageable.
"I'm sorry, the system is not working."
Ms Ley said frustrated taxpayers had told her of promised refunds not arriving, involving large amounts.
The tax office identified a glitch in early April where 140,000 tax returns for individuals had been sent out without an accompanying cheque.
The hearing was told the tax office rectified the problem and had the cheques printed on Monday.
Mr D'Ascenzo said cleanskin tax returns would be processed without incident from the end of April.
The tax office closed its computer processing from Christmas until late January so it could move 32 million tax accounts onto a new system.
As a result of the summer delay, the tax office is now processing 188,000 more complex returns - 88,000 more than normal because of the delay.
"I'm not sure what you do when you close a road," Mr D'Ascenzo said in his biannual appearance before the parliamentary committee.
The hearing was told the tax office had fast-tracked 3843 returns from people facing hardship.
Ms Ley congratulated the tax commissioner on his approach to helping those in need, including drought-affected farmers.
AAP
The tax commissioner has fronted a parliamentary hearing to explain how a computer glitch caused 140,000 Australians to miss out on tax refund cheques.
Michael D'Ascenzo admitted the Australian Taxation Office's performance standards had dropped during an $824 million technology upgrade.
"With a system deployment as large as this some transitional issues are unavoidable," he told a parliamentary hearing in Canberra.
"Our performance against service delivery standards has dipped in the face of increasing workloads."
But Mr D'Ascenzo told an earlier public accounts and audit committee that the transition to a new computer system had not been a catastrophic failure.
"I don't think you can justifiably say the system is not working," he said.
"It's the sort of issues you'd expect from the implementation."
Opposition assistant treasury spokeswoman Sussan Ley, however, told the commissioner the delay in getting refund cheques to taxpayers was a sign the tax office would struggle to implement future tax reforms.
"There's something Monty Python-esque about you saying the system is working well," she said.
"People have described it as a debacle, as a disaster, as unmanageable.
"I'm sorry, the system is not working."
Ms Ley said frustrated taxpayers had told her of promised refunds not arriving, involving large amounts.
The tax office identified a glitch in early April where 140,000 tax returns for individuals had been sent out without an accompanying cheque.
The hearing was told the tax office rectified the problem and had the cheques printed on Monday.
Mr D'Ascenzo said cleanskin tax returns would be processed without incident from the end of April.
The tax office closed its computer processing from Christmas until late January so it could move 32 million tax accounts onto a new system.
As a result of the summer delay, the tax office is now processing 188,000 more complex returns - 88,000 more than normal because of the delay.
"I'm not sure what you do when you close a road," Mr D'Ascenzo said in his biannual appearance before the parliamentary committee.
The hearing was told the tax office had fast-tracked 3843 returns from people facing hardship.
Ms Ley congratulated the tax commissioner on his approach to helping those in need, including drought-affected farmers.
Tuesday, April 20, 2010
Export boom drove rate rise
stronger-than-expected prospective rise in the terms of trade was a major factor in the Reserve Bank of Australia's decision to increase official interest rates in April, its board minutes show.
In its April 6 minutes released today, the RBA board said lending rates were still below average when it made the decision and interest rates would be expected to be "close to average" in view of its economic forecasts.
The RBA decided to lift the cash rate by 0.25 per cent to 4.25 per cent on April 7, making it the fifth increase since early October.
The dollar rose to 92.7 US cents from 92.5 US cents before the meeting minutes were released. Interest rate expectations nudged up to a 32 per cent chance of a rate rise in May from 28 per cent beforehand, according to Credit Suisse.
The central bank said the prospective rise in the terms of trade was now likely to be "noticeably stronger than had been expected" which was a factor in suggesting that "it might be prudent not to delay adjustment".
"Overall members considered that the outlook for the economy suggested that there was a case for a further step in the process of returning interest rates to more normal levels," the minutes said.
The minutes said recent data for the world economy suggested the recovery in the major advanced economies was still "tentative" but the expansion of Australia's major trading partners in Asia was "proceeding strongly," feeding through into significant increases in the prices of resource commodities such as coal and iron ore.
"While there were a number of risks to the outlook for the global economy, the most likely scenario was one where growth in global output was close to trend over the next few years," the minutes said.
The board said forecasts suggested growth in the domestic economy in 2010 would be "around trend" and that inflation would be "around 2.5 per cent," consistent with the medium-term target, the level of interest rates would be expected to be "close to average".
"This remained the underlying rationale for consideration of any adjustment to the cash rate in the current period," the minutes said.
"Since lending rates were still a little below average, members expected that they would probably need to rise further in the period ahead."
''Members discussed the factors contributing to the recent strong price growth (in housing). On the demand side, population growth was strong, households had confidence about future income growth, and mortgage rates were at below-average levels.'' ''At the same time, the supply of new housing was not expanding sufficiently, partly because of the land usage policies of local and state governments and also because of the tightness of finance for developers. Members also noted that the current price growth was somewhat at odds with the falls in housing loan approvals over recent months.''
The board noted that developments in commodity markets meant that the increase in the terms of trade through 2010 was likely to be substantially larger than forecast in the February statement of monetary policy.
"This implied strong growth in nominal incomes in the Australian economy in 2010," the minutes said.
Increases in coal and iron ore prices and developments in the LNG sector were also contributing to a "strong outlook for investment" in the resources sector, it said.
"Members noted that while the Australian economy was benefiting significantly from developments in the resources sector, these would also pose challenges."
Although spot prices for iron ore were below the 2007/08 levels, contract prices were expected to rise to "new highs" and indications for coal contract prices also pointed to "large increases".
The minutes also said information on the housing market suggested that "conditions remained buoyant" with capital city price growth running at around one per cent in early 2010
In its April 6 minutes released today, the RBA board said lending rates were still below average when it made the decision and interest rates would be expected to be "close to average" in view of its economic forecasts.
The RBA decided to lift the cash rate by 0.25 per cent to 4.25 per cent on April 7, making it the fifth increase since early October.
The dollar rose to 92.7 US cents from 92.5 US cents before the meeting minutes were released. Interest rate expectations nudged up to a 32 per cent chance of a rate rise in May from 28 per cent beforehand, according to Credit Suisse.
The central bank said the prospective rise in the terms of trade was now likely to be "noticeably stronger than had been expected" which was a factor in suggesting that "it might be prudent not to delay adjustment".
"Overall members considered that the outlook for the economy suggested that there was a case for a further step in the process of returning interest rates to more normal levels," the minutes said.
The minutes said recent data for the world economy suggested the recovery in the major advanced economies was still "tentative" but the expansion of Australia's major trading partners in Asia was "proceeding strongly," feeding through into significant increases in the prices of resource commodities such as coal and iron ore.
"While there were a number of risks to the outlook for the global economy, the most likely scenario was one where growth in global output was close to trend over the next few years," the minutes said.
The board said forecasts suggested growth in the domestic economy in 2010 would be "around trend" and that inflation would be "around 2.5 per cent," consistent with the medium-term target, the level of interest rates would be expected to be "close to average".
"This remained the underlying rationale for consideration of any adjustment to the cash rate in the current period," the minutes said.
"Since lending rates were still a little below average, members expected that they would probably need to rise further in the period ahead."
''Members discussed the factors contributing to the recent strong price growth (in housing). On the demand side, population growth was strong, households had confidence about future income growth, and mortgage rates were at below-average levels.'' ''At the same time, the supply of new housing was not expanding sufficiently, partly because of the land usage policies of local and state governments and also because of the tightness of finance for developers. Members also noted that the current price growth was somewhat at odds with the falls in housing loan approvals over recent months.''
The board noted that developments in commodity markets meant that the increase in the terms of trade through 2010 was likely to be substantially larger than forecast in the February statement of monetary policy.
"This implied strong growth in nominal incomes in the Australian economy in 2010," the minutes said.
Increases in coal and iron ore prices and developments in the LNG sector were also contributing to a "strong outlook for investment" in the resources sector, it said.
"Members noted that while the Australian economy was benefiting significantly from developments in the resources sector, these would also pose challenges."
Although spot prices for iron ore were below the 2007/08 levels, contract prices were expected to rise to "new highs" and indications for coal contract prices also pointed to "large increases".
The minutes also said information on the housing market suggested that "conditions remained buoyant" with capital city price growth running at around one per cent in early 2010
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