Thursday, 8 October 2020
Treasury Laws Amendment (A Tax Plan for the COVID-19 Economic Recovery) Bill 2020; Second Reading
I thank those who have contributed to this debate on the Treasury Laws Amendment (A Tax Plan for the COVID-19 Economic Recovery) Bill 2020.
In summing up on this very important bill, schedule 1 of the bill brings forward tax cuts in stage 2 of the Personal Income Tax Plan from 1 July 2022 to 1 July 2020 and retains the low- and middle-income tax offset through 2020-21. As has been said, this measure will provide tax relief of around $17.8 billion over the forward estimates, which ultimately means more money in the hands of Australians. This will provide around 11.6 million individuals with a tax cut, compared with the 2017-18 settings. These tax cuts support low- and middle-income Australians with the majority of the benefit in 2020-21 being received by those on incomes below $90,000. Low- and middle-income earners will receive tax relief in 2020-21 of $2,745 for singles and up to $5,490 for dual-income families when compared with 2017-18 settings. Ultimately, this gives families the certainty that they can pay their bills and the freedom to spend that money. Greater consumption will also support businesses, which will flow through to increased hiring and business investment. This will support jobs and growth and help the economic recovery effort. The government's Personal Income Tax Plan contributes to a stronger and more resilient economy. This bill therefore accelerates the government's commitment to deliver lower taxes and a simpler tax system that benefits all Australians.
Schedule 2 to the bill provides temporary loss carry back, which allows companies with turnover of up to $5 billion to offset current tax losses against prior profits to provide a much-needed cash boost for firms that have been negatively impacted by the coronavirus pandemic and to support the use of temporary full expensing. Schedule 3 to the bill expands access to a range of small business tax concessions by increasing the aggregated annual turnover threshold for these concessions from $10 million to $50 million. The changes will cut red tape and give eligible businesses access to these additional 10 concessions for the first time. Schedules 4 to 6 of the bill implement our much-needed reforms to the research and development tax incentive. And, importantly, schedule 7 to the bill will support business investment and economic recovery by allowing businesses with turnover of less than $5 billion to deduct the full cost of eligible depreciable assets of any value acquired and first used or installed between 7.30 pm Australian eastern daylight time on 6 October 2020 and 30 June 2022.
This bill delivers tax relief at a time when it is needed most. I therefore commend this bill to the House.
Question agreed to.
Bill read a second time.
Message from the Governor-General recommending appropriation announced.