FEDERAL BUDGET 2010: At a glance

As expected, Wayne Swan’s third budget is a conservative and cautious affair, aimed at steering Australia back towards a budget surplus as quickly as possible.

Here is quick rundown of the highlights of the 2010 Federal Budget:

  • The main initiatives for small business were previously released as part of the Government’s response to the Henry Tax Review. These include a reduction of the corporate tax rate from 30% to 28% and the immediate write-off for assets costing less than $5,000. Both will come into effect from July 1, 2012.
  • The Budget will be back in surplus three years earlier than expected thanks to Australia’s fast-recovering economy. While the fiscal deficit in 2010-11 is expected to be $39.6 billion, a surge in Government tax receipts will see the Budget return to a $2 billion surplus in 2012-13.
  • The Government has forecast the economy will grow by 3.25% in 2010-11 before accelerating to 4% in 2011-12.
  • Treasury says unemployment peaked at 5.8% last year and will now fall to 4.75% over the next four years, indicating the Australian economy is close to full employment.
  • The Government has delivered the third tranche of tax cuts promised in the 2007 election campaign. The 30% tax rate has been raised for all taxpayers from $35,000 to $37,000, saving the average taxpayer $200 a year.
  • The Government will introduce a standard deduction clause for taxpayers that will allow taxpayers to deduct $500 of work-related and tax agent expenses from 2012-13, with the allowance rising to $1,000 from 2013-14. The Government predicts 6.4 million people could use this option.
  • The Government will spend more than $660 million in training, apprenticeships and adult literacy and numeracy programs over the next four years. Initiatives included 39,000 additional training places in high-demand sectors, plus support for 22,500 apprentices.
  • The rules under which listed companies can issue bonds to retail investors will be simplified in a move designed to provide companies with an alternative to bank finance.
  • The Government will encourage savings by providing a 50% tax discount on the first $1,000 of interest earned on deposits, bonds, debentures and annuity products.
  • The Government will spend $125.2 million over the next eight years to create a single national online registration system for business names and Australian Business Numbers, meaning businesses will no longer need to be registered in each State and Territory.
  • As foreshadowed in the Government’s response to the Henry Review, a new $700 million infrastructure fund will start in 2012-13 and spend $5.6 billion over the next decade – funded by the Resources Super Profits Tax. The Government will also spend $1 billion to improve rail capacity.
  • An extra $2.2 billion for improved access to GPs, more money for nurses and $467 million for an e-Health system.
  • The Government will also phase down the interest withholding tax rate on interest paid on offshore borrowing to encourage foreign institutions into the market.
  • Small businesses that account for GST on a cash basis will be allowed to claim input tax credit upfront in relation to hire purchase agreements.
  • The Government will spend $2.7 million to improve access to mediation for those operating under the Franchising Code of Conduct, the Horticulture Code and the Produce and Grocery Industry Code.


Notify of
Inline Feedbacks
View all comments
SmartCompany Plus

Sign in

To connect a sign in method the email must match the one on your SmartCompany Plus account.
Or use your email
Forgot your password?

Want some assistance?

Contact us on: support@smartcompany.com.au or call the hotline: +61 (03) 8623 9900.