The federal government appears set to introduce a two-tiered tax system, according to comments by Social Services Minister Scott Morrison published by The Australian.
In the government’s first budget in May 2014, it indicated it would cut the company tax from 30% to 28.5%, but the tax relief would be neutralised by a 1.5% paid parental leave levy on companies with annual taxable income of more than $5 million.
During his address to the National Press Club on Monday, Tony Abbott announced he was abandoning his paid parental leave scheme, with funds collected by the levy instead assumed to be earmarked for a new childcare policy.
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However, Morrison told The Australian the government will now abandon the levy altogether. But larger companies will still be charged a company tax rate of 30%, while smaller business will pay a lower rate of 28.5%.
“The government doesn’t assume portability of this levy and if (a new childcare levy) were an option then you’d certainly have to make a case for it and you’d certainly have to consult business about it. But I don’t think anyone should be making the assumption that is where the government would end up,” said Morison.
No buyer leads Keeforce to axe jobs
Keeforce Group, one of Queensland’s largest logistics businesses, will be forced to axe jobs after it failed to secure a buyer following its recent collapse.
Administrators Ferrier Hodgson said today Keeforce would need to be restructured to preserve any parts of the business that are of interest to potential buyers.
“We have received interest in both businesses from a range of parties, but unfortunately, there is no buyer for the business in its entirety,” said administrator Brendan Richards.
“It is unfortunate that such a significant reduction in the Keeforce fleet and employees is now inevitable, but we are working hard to save some aspect of the business.”
The family-owned business, which included sister company Fresh Produce Logistics and related entities, was established in 2002 and had turned over a combined total of $75 million annually.
Aussie shares up
Local shares have continued to rally this morning, following the Reserve Bank of Australia’s growth forecast.
“It promises to be a fascinating day on the stock market with all eyes focused on whether the relentless pursuit of “yield” will continue in the form of ongoing buying of bank stocks,” said Ric Spooner, chief market analyst at CMC Markets.
“History may reveal that much of the recent weight of money for these stocks has come from offshore. However, domestic investors considering dividends as an alternative to dwindling incomes form term deposits and bonds will be very focused on today’s RBA monetary statement.”
The S&P/ASX200 benchmark was up 9.8 points to 5820.8 points at 12:15PM AEDT. On Thursday, the Dow Jones closed up 1.20%, rising 211.86 points to 17,884.9 points.