Key 2012 Federal Budget Outcomes

• The government has indicated it will not proceed with the 1% reduction in company tax, due to commence from the 1st July 2012.
• Standard Tax Deductions For Work Related Expenses - has been withdrawn.
• Tax Breaks for "Green Building Fund", estimated to cost $405M, has been withdrawn. (This related to the government's intention to allow an automatic deduction for work related expenses in the hope that taxpayers would not wish to lodge personal tax returns).
• The higher cap for superannuation contributions for people aged over 50, with under $500,000 invested in superannuation, has been deferred for two years. (The affect of this is that superannuation contributions for persons aged over 50, with under $500,000 invested in superannuation, will only be $25,000 per annum, from 1st July 2012, as compared to the original commitment to increase the allowable deduction to $50,000).
• The announced tax break on interest earned on bank deposits (a 50% tax discount) has been scrapped.

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• The small business assistance previously announced with immediate write-off of eligible assets which cost less than $6,500 and an accelerated write-off of $5,000 for the purchase of cars and utilities, operational from 1st July 2012, will continue. The cashflow benefit from this initiative will not accrue to taxpayers until 2013/14.
• The budget includes massive cash handouts to boost Family Tax Benefit Part A recipients and introduces a new school children's bonus to replace the education tax refund which was not being fully utilised.
• Changes to Private Health Insurance Rebate and Medicare Levy Surcharge - the government has already announced measures to change the entitlement to the Private Health Insurance Rebate and the Medicare Levy Surcharge which will be income tested against three income tier thresholds. The income thresholds that apply to the 2012/13 financial year are: