Taxation Strategies Under a Labor Government

Australia has a new government and it’s promising to deliver tax relief for more than nine million Australians with incomes above $45,000 by delivering the legislated stage three tax cuts introduced under Liberal.

Additionally, our new Labor government has promised to support cost of living relief for Australians through an increase in the low-and-middle income tax offset by $420 this year.

Prime Minister Anthony Albanese’s winning campaign assured Australians that a Labor government would also “focus on meaningful investments for maximum economic impact and community need, cracking down on waste and rorts, (and) making sure multinationals are paying their fair share of tax”.

Indeed, Labor has committed to supporting the Organisation for Economic Co-operation and Development’s (OECD) ‘two pillar’ solution to ensure multinational enterprises are subject to a minimum 15% tax rate from 2023.

Consistent with OECD recommendations, they’ve also announced that multinationals’ debt-related deductions will be limited to 30% of profits. And they will introduce transparency measures, including new reporting requirements on tax information, beneficial ownership, and tax haven exposure.

These are the only tax reforms anticipated from Australia’s 31st government at this stage, however we’ll see what unfolds over the coming years.

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