NSW Budget 2014
The New South Wales Treasurer, Andrew Constance, released the State's Budget on 17 June 2014
What taxation measures were announced?
Abolishment of stamp duties
The stamp duties listed under the Intergovernmental Agreement, including duties on business mortgages, unlisted marketable securities and transfer duty on non-real business transfers, will be abolished from 1 July 2016.
Many transactions will still be subject to duties, including:
- Transfers of land, including interests in land;
- Land and chattels;
- Plant and equipment; and
- Landholder duty on transfers of shares or units in entities that, directly or indirectly through downstream entities, hold land or land and chattels/plant and equipment.
Enhanced revenue compliance activity
Due to the significant performance of compliance activity measures introduced in the previous Budget, the Government has extended the program.
The enhanced package will expand analysis, investigation and audit of complex business and trust structures for stamp duties, payroll tax, land tax and mineral royalties. The Office of State Revenue will also begin to administer mineral royalties from 1 July 2014, with responsibility transferred from the Department of Trade and Investment, Regional Infrastructure and Services.
This measure is expected to increase revenue by $248 million by 2017-18.
First Home Owners Grant extension and eligibility
The First Home Owners Grant will be extended to new dwellings valued at up to $750,000 from 1 July 2014. The eligibility for the $5,000 New Home Owners Grant will be restricted to Australian citizens and permanent residents from 1 July 2014.
Payroll tax rebate
A $6,000 payroll tax rebate will be provided to businesses that employ workers who have recently been made unemployed through large scale redundancies.
Employers hiring a redundant worker from a designated employer will receive a $1,000 payroll tax rebate in addition to the existing $5,000 rebate, where the worker is made redundant between 1 January 2014 and 30 June 2015. To be classified as a designated employer, criteria such as the scale of retrenchments, the sector where the retrenchments occurred, the impact of the retrenchments on a particular industry or region of the State and the possibilities for reemployment will be considered.
Due to the increased audit activity, if you fall into one of the categories, it is timely to consider tax audit insurance. The audit process can be very costly and time intensive. Audit insurance could protect you from the unexpected costs incurred in responding to a compliance audit or an audit of a return you have previously lodged (e.g. Payroll Tax Return). The insurance can provide provisions for reimbursement of related professional fees and associated costs of the audit. We can arrange appropriate tax audit insurance for you, please contact us for more information.
Contact our Tax team in Sydney or Newcastle for further information or assistance in dealing with any of the proposed changes that might impact you or your business.