The taxman plans to raise an extra $3.8 billion in GST by extending a compliance crackdown on businesses as part of the government’s efforts to lift tax receipts and repair its bottom line.
Multinationals also face a new minimum tax rate, while gas companies will be taxed an extra $2.4 billion over five years under changes to the Petroleum Resource Rent Tax that were announced in the lead-up to the budget.
Tonight’s budget showed the government expects to raise substantial extra revenue from the business world over the next four years, though this is mainly because of upgrades to its economic outlook and high commodity price assumptions.
Among the policy changes to raise more revenue, an extension in a GST compliance program is the biggest initiative, raising $3.8 billion over the next four years. The government said the program would involve giving the Australian Tax Office an extra $588 million to continue with “a range of activities that promote GST compliance.”
Global companies are also in the taxman’s sights, with the budget confirming Labor would introduce minimum tax rates of 15 per cent for big multinationals. The measure, which implements an election commitment and is part of a global effort to counter tax-dodging, is expected to raise $370 million over five years.
But these revenue-raising measures were dwarfed by the big upgrades in expected company tax receipts, thanks to buoyant conditions in the resources sector.
Since October, the government has raised its forecasts for company tax receipts in the coming financial year by $28.9 billion, and it now expects to collect an extra $52.7 billion in company tax over the five years from 2022-23.
As for support measures, the budget announced a tax break allowing small firms to deduct the full cost of eligible assets costing up to $20,000.