Could your $1,080 tax cut be delayed by a year?

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on May 21, 2019
Could your $1,080 tax cut be delayed by a year?

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Doubts have been raised over whether Scott Morrisonโ€™s big election promise to deliver tax cuts of up to $1,080 per person can be delivered in the next financial year as Federal Parliament looks unlikely to return before June 30.

Appearing on Sky News last night, Mr Morrison said he was waiting for the election writs to be returned before Federal Parliament can be recalled – which may not be until late June.

“We obviously have to wait for the writs to be returned and there is a formal process for that,” Mr Morrison said.

“At the moment, it is not looking like until the back end of June. So that really does make very narrow the opportunity to do it before June 30, and I think that is very unlikely with the advice I have received.”

Election writs can only be returned to parliament after an exhaustive vote count has been completed – which is still ongoing.

Three federal seats are still on a knife-edge as vote counting continues. This could push back the start of parliament if the result goes down the wire.

Mr Morrison was hoping to get the law pushed through quickly so the tax cuts could be applied to tax returns lodged this financial year.

Under the tax cuts, Australian’s earning up to $126,000 a year would receive up to $1,080 back on their tax return. Dual-income families would receive up to $2,160 back per year.

A spokeswoman for the Prime Minister has since come out and said the cuts will be delivered in 2019-20 as promised.

“And will not be delayed by a year by the parliament not sitting in June as speculated in the media today,” the spokeswoman told The Australian.

ATO says they can amend your tax return

The Australian Tax Office (ATO) released a statement last month confirming Parliament needs to change the law for the tax cuts to be implemented, but said it could retrospectively amend assessments to provide the tax cut once the law is passed.

“Following media commentary we would like to clarify that in respect of announced tax cuts, while we do need law change there are also things we can do administratively,” the ATO statement reads.

“For example, if the Labor party agrees to support the Coalition tax cuts as announced, then we would be able to update the tax withholding schedules, to allow the tax cuts to be reflected in people’s take home pay. However, we could not issue assessments based on the tax cuts until these are passed into law.

“If the law for these tax cuts passes after June, we could also retrospectively amend assessments to provide the tax cut once the law is passed.”

The New Daily reported the very real possibility of the rebate being delayed almost as soon as the budget was handed down because of the impossibility of the timetable being workable.

Labor previously warned Mr Morrison that his delay in calling the election could result in an impossible time frame to deliver the tax cuts.

Treasurer Josh Frydenberg and Mr Morrison are expected to meet in Sydney today to discuss the economy and tax cuts, as RBA governor Phillip Lowe gets set to make a major speech today on the economic outlook for Australia.

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Emma Duffy is Assistant Editor at Your Mortgage andย  Your Investment Property Mag, which are part of the Savings Media Group. In this role, she manages a team of journalists and expert contributors committed to keeping readers informed about the latest home loan and finance news and trends, as well as providing in-depth property guides. She is also a finance journalist at which she joined shortly after its launch in early 2019. Emma has a Bachelor in Journalism and has been published in several other publications and been featured on radio.


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