2018-19 Budget Snapshot
The ‘2018-19 Budget Snapshot’ by the Parliamentary Budget Office illustrates key features of the budget, presenting 15 figures on the underlying cash balance, payments and receipts, net debt, change in Budget position, economic parameters, revenue, expenses, and payments to States.
(Source: Parliamentary Budget Office | Snapshot)
Policy Costing on Dividend Imputation Credit Refunds
The Parliamentary Budget Officer has publicly released the ‘Dividend Imputation Credit Refunds‘ policy costing, requested by Senator David Leyonhjelm.
The proposal involves two options to change the tax treatment of franking credits attached to distributions (otherwise known as imputation credits) from a refundable tax offset to a non-refundable tax offset:
Option 1: Make franking credits non-refundable for all individuals and superannuation funds.
Option 2: Make franking credits non-refundable for individuals and superannuation funds, except for recipients of Australian Government pensions and allowances with individual shareholdings, and self-managed superannuation funds with at least one member who is an Australian Government pension or allowance recipient before 28 March 2018.
The proposal would have effect from 1 July 2019.
Financial impact
The policy costing found that Option 1 would be expected to increase the fiscal and underlying cash balances by $5,597 million over the 2017-18 Budget forward estimates period, while Option 2 would be expected to increase the fiscal and underlying cash balances by $5,197 million. The impact for both primarily reflects increases in revenue, but also includes a non-ongoing increase in departmental expenses for the ATO.
Along with the financial implications analysis, the costing includes tables on individuals and superannuation funds directly affected in 2019-20, and tables for the analysis of individuals and superannuation funds in 2014-15.
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