Australian Economic Statement reveals extra funding for ATO

International Tax Review is part of Legal Benchmarking Limited, 1-2 Paris Garden, London, SE1 8ND

Copyright © Legal Benchmarking Limited and its affiliated companies 2025

Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement

Australian Economic Statement reveals extra funding for ATO

aus.jpg

Australian Treasurer Chris Bowen last week released his Economic Statement which details the economic outlook for Australia. The statement reveals extra funding for the tax authority, as well as outlining reforms to corporate tax incentives.

The Economic Statement says the Australian Taxation Office (ATO) will be given additional resources to address the level of tax debt and unpaid superannuation.

“The government is providing the ATO with an additional A$99 million ($89 million) over four years to address the levels of unpaid tax and superannuation in the community,” said Bowen in a joint media release with Senator Penny Wong, Minister for Finance and Deregulation. “This measure will return A$45 million in superannuation to Australian workers and ensure a level playing field for Australian businesses.”

Despite going through a turbulent time politically, with Kevin Rudd replacing Julia Gillard (the woman who ousted him in 2010) as Prime Minister at the end of July, Australia has been at the forefront of international efforts to reform tax rules.

“The scoping paper [on risks to the sustainability of Australia’s corporate tax base] also seeks to announce to the international community the prominent role that Australia sees itself playing in the OECD/G20 BEPS project as a self-proclaimed “middle power” and 2014 chair of the G20,” said Leon Mok, of Baker Tilly Pitcher Partners.

The country is also aiming to increase investment through changes to the tax code. In July, David Bradbury, Assistant Treasurer, released a statement regarding a new tax incentive to drive private investment in infrastructure.

“This measure was lobbied for to ease the issue of significant losses in early years,” said Richard Snowden, of King & Wood Mallesons.

The Economic Statement confirmed the move to incentivise private investment and pledged a review of other measures too.

“The government is also improving incentives to support up to A$25 billion in nationally significant infrastructure spending by the private sector, by preserving the real value of tax losses over time and making it easier for investors to access these losses,” said Bowen

“The government has also acted to promote greater fairness and sustainability in the tax system by removing outdated or poorly targeted tax concessions,” he added.

Another tranche of this reform effort relates to research and development, and with an election looming (Rudd has announced the election date as September 7), the Labor government will be doing all it can to keep taxpayers happy and manage the budget by attracting greater levels of investment.

“The government is supporting investment in R&D by doubling the rate of assistance for SMEs and improving cash flow by providing a 45% refundable tax offset,” said Bowen.

more across site & shared bottom lb ros

More from across our site

The South Africa vs SC ruling may embolden the tax authority to take a more aggressive approach to TP assessments, an adviser tells ITR
Indirect tax professionals now rate compliance as a bigger obstacle than technology and automation; in other news, Italy approved a VAT cut on art sales
AI-powered tax agents are likely to be the next big development in tax technology, says Russell Gammon of Tax Systems
FTI Consulting’s EMEA head of employment tax and reward tells ITR about celebrating diversity in the profession, his love of musicals, and what makes tax cool
Canadian Prime Minister Mark Carney and US President Donald Trump have agreed that the countries will look to conclude a deal by July 21, 2025
The firm’s lack of transparency regarding its tax leaks scandal should see the ban extended beyond June 30, senators Deborah O’Neill and Barbara Pocock tell ITR
Despite posing significant administrative hurdles, digital services taxes remain ‘the best way forward’ for emerging economies, says Neil Kelley, COO of Ascoria
A ‘joint understanding’ among G7 countries that ‘defends American interests’ is set to be announced, Scott Bessent claimed
The ‘big four’ firm’s inaugural annual report unveiled a sharp drop in profits for 2024; in other news, Baker McKenzie and Perkins Coie expanded their US tax benches
Representatives from the two countries focused on TP as they met this week to evaluate progress under a previously signed agreement – it is understood
Gift this article