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Australian Government Coat of Arms

Budget | 2014-15

Budget 2014-15
Australian Government Coat of Arms, Budget 2014-15

Part 2: Expense Measures (continued)

Treasury

Abolish the Seafarer Tax Offset

Expense ($m)
  2013-14 2014-15 2015-16 2016-17 2017-18
Australian Taxation Office ‑4.0 ‑4.0 ‑4.0

The Government will achieve savings of $12.0 million over three years by abolishing the Seafarer Tax Offset from 1 July 2015. In underlying cash terms, the saving is $8.0 million over the forward estimates period, due to the timing of the tax offset claims.

The savings from this measure will be redirected by the Government to repair the Budget and fund policy priorities.

Addressing insurance costs in North Queensland

Expense ($m)
  2013-14 2014-15 2015-16 2016-17 2017-18
Department of the Treasury ‑37.2 ‑32.4 6.3 3.1

The Government will provide up to $12.5 million over three years from 2014‑15 to the Queensland Government to provide grants to bodies corporate to undertake engineering assessments of strata‑title properties in North Queensland. The assessments are to identify risks that can be mitigated.

The assessments will provide better information to insurers which will enable them to set premiums that more accurately reflect individual property risks. The assessments will also help residents of strata‑title properties to be fully aware of the risks to their properties from natural disasters. This will provide bodies corporate with an opportunity to take necessary action to mitigate those risks and reduce their risk assessment by insurers, and ultimately reduce insurance premiums in some cases.

The costs associated with this measure and the related expense measure titled Addressing Insurance Costs in North Queensland — establishment of an insurance comparison website, will be offset by savings of $72.2 million over two years from 2013‑14 from the cessation of the National Insurance Affordability Initiative.

See also the related expense measure titled Addressing Insurance Costs in North Queensland — establishment of an insurance comparison website.

Addressing insurance costs in North Queensland — establishment of an insurance comparison website

Expense ($m)
  2013-14 2014-15 2015-16 2016-17 2017-18
Department of the Treasury nfp nfp nfp nfp
Related capital ($m)
Department of the Treasury nfp nfp nfp nfp

The Government will provide funding over four years (including a capital component) to the Department of the Treasury to develop an insurance comparison website on strata‑title and home building and contents insurance offerings in North Queensland.

Insurance comparison sites can reduce search and transaction costs for consumers and allow consumers to make more informed decisions about their insurance purchase.

The expenditure for this measure is not for publication due to commercial sensitivity.

See also the related measure titled Addressing insurance costs in North Queensland.

Australian Competition and Consumer Commission — additional funding

Expense ($m)
  2013-14 2014-15 2015-16 2016-17 2017-18
Australian Competition and Consumer Commission 17.7
Related capital ($m)
Australian Competition and Consumer Commission 0.6

The Government will provide funding of $68.5 million over four years from 2014‑15 to the Australian Competition and Consumer Commission (ACCC) to fund its operations. This funding will assist the ACCC to monitor prices and protect consumer interests in relation to the repeal of the carbon tax. The ACCC has put in place a range of financial management and governance reforms to ensure that it operates within its agreed budget from 2014‑15.

This funding is in addition to the $25.3 million provided in the 2013‑14 Additional Estimates for the ACCC to fund its operating costs in 2013‑14.

Funding for this measure for 2014‑15 to 2016‑17 was included as a 'decision taken but not yet announced' in the Mid‑Year Economic and Fiscal Outlook 2013‑14.

Australian Securities and Investments Commission — savings

Expense ($m)
  2013-14 2014-15 2015-16 2016-17 2017-18
Australian Securities and Investments Commission 3.0 ‑26.0 ‑32.5 ‑32.1 ‑32.4

The Government will achieve savings of $120.1 million over five years by reducing funding to the Australian Securities and Investments Commission (ASIC).

ASIC will adjust its priorities to ensure it continues to meet its statutory objectives.

The savings from this measure will be redirected by the Government to repair the Budget and fund policy priorities.

Australian Taxation Office — savings

Expense ($m)
  2013-14 2014-15 2015-16 2016-17 2017-18
Australian Taxation Office ‑16.8 ‑42.0 ‑84.0

The Government will achieve savings of $142.8 million over three years from 2015‑16 by reducing the Australian Taxation Office's (ATO) departmental resourcing.

The ATO will bring forward staff reductions that were already planned in response to efficiency dividends and decisions of the former Government. Under the former Government total staffing reductions of 4,700 were to occur over the forward estimates period to 2017‑18. This included a reduction of 900 in 2013‑14, 500 in 2014‑15, 1,600 in 2015‑16, 1,200 in 2016‑17, and 500 in 2017‑18.

The Government will bring forward the reduction in staffing numbers that were due to occur in 2015‑16. As these staff reductions have already been factored into the forward estimates, there will be no net increase to the total staff reductions planned. Staffing reductions do not include the impact of the additional 0.25 per cent efficiency dividend announced by the Government in the 2013 Federal Election.

The savings from this measure will be redirected by the Government to repair the Budget and fund policy priorities.

Brisbane Cross River Rail and Melbourne Metro Projects Advisory Board — cessation

Expense ($m)
  2013-14 2014-15 2015-16 2016-17 2017-18
Department of the Treasury ‑1.6

The Government will achieve savings of $1.6 million in 2014‑15 by ceasing the Brisbane Cross River Rail and Melbourne Metro Projects — Advisory Board measure, announced in the 2013‑14 Budget.

The savings from this measure will be redirected by the Government to repair the Budget and fund policy priorities.

Exploration Development Incentive — Introduction

Expense ($m)
  2013-14 2014-15 2015-16 2016-17 2017-18
Australian Taxation Office 25.0 35.0 40.0

The Government will provide $100.0 million over three years to introduce an Exploration Development Incentive (EDI). The EDI will allow small mineral exploration companies with no taxable income to provide exploration credits, paid as a refundable tax offset, to their Australian resident shareholders for greenfields mineral exploration.

This measure is designed to encourage increased mining exploration and delivers on the Government's election commitment.

Further information can be found in the Coalition's Policy for Resources and Energy.

Extension of Unfair Contract Provisions to Small Businesses

Expense ($m)
  2013-14 2014-15 2015-16 2016-17 2017-18
Australian Competition and Consumer Commission 0.2 0.4 0.4 0.4

The Government will provide $1.4 million over four years to the Australian Competition and Consumer Commission to support the extension of unfair contract term provisions available to consumers under the Australian Consumer Law to small businesses.

Small businesses can face many of the same issues as individual consumers when negotiating contracts with big businesses.

This measure delivers on the Government's election commitment.

Further information can be found in the Coalition's Policy for Small Business.

First Home Saver Accounts scheme — cessation

Expense ($m)
  2013-14 2014-15 2015-16 2016-17 2017-18
Australian Taxation Office ‑1.0 ‑18.0 ‑36.1 ‑37.1 ‑38.1
Related revenue ($m)
Australian Taxation Office 2.0 2.0

The Government will achieve savings of $134.3 million over five years by abolishing the First Home Saver Accounts scheme due to lower than forecast take‑up rates. New accounts opened from Budget night will not be eligible for concessions, with the Government co‑contribution to cease from 1 July 2014 and tax concessions and the income and asset test exemptions for government benefits associated with these accounts to cease from 1 July 2015. In underlying cash terms, the saving is $113.3 million over the forward estimates period due to the timing of the claims, including $54.3 million in departmental resourcing.

The savings from this measure will be redirected by the Government to repair the Budget and fund policy priorities.

Infrastructure Growth Package — Asset Recycling Initiative — establishment

Expense ($m)
  2013-14 2014-15 2015-16 2016-17 2017-18
Department of the Treasury 335.0 1,278.0 1,285.0 1,007.0

The Government will provide $5.0 billion over five years to 2018‑19 (including $1.1 billion in 2018‑19) to establish an Asset Recycling Initiative (the Initiative), which will provide state and territory governments with incentive payments to unlock capital from state‑owned assets and reinvest the proceeds in new productivity‑enhancing economic infrastructure.

The Initiative will be supported by a National Partnership Agreement with participating states and territories that will provide incentive payments set at 15 per cent of the sale price of the asset, paid in two instalments on the completion of set milestones. Incentive payments will be available for asset sales and reinvestment programmes agreed with the Commonwealth prior to 30 June 2016. The Initiative is time limited and will close at the end of 2018‑19, or once funds have been exhausted.

See also related expense measure titled Infrastructure Growth Package — Asset Recycling Fund — establishment.

Further information can be found in the press release of 28 March 2014 issued by the Treasurer.

Inspector‑General of Taxation — transfer of tax complaints handling

Expense ($m)
  2013-14 2014-15 2015-16 2016-17 2017-18
Inspector General of Taxation 0.7 0.7 0.6 0.7
Office of the Commonwealth Ombudsman ‑0.6 ‑0.6 ‑0.6 ‑0.6
Total — Expense 0.1 .. .. ..

The Government will provide $0.1 million over four years from 2014‑15 to transfer the function for taxation complaints case handling from the Office of the Commonwealth Ombudsman to the Inspector‑General of Taxation.

This will enhance the systematic review role of the Inspector‑General of Taxation and provide taxpayers with more specialised and focused complaint handling for tax matters.

Small Business and Family Enterprise Ombudsman

Expense ($m)
  2013-14 2014-15 2015-16 2016-17 2017-18
Department of the Treasury 2.0 2.0 2.0 2.0

The Government will provide $8.0 million over four years to the Department of the Treasury to transform the existing Office of the Australian Small Business Commissioner into a Small Business and Family Enterprise Ombudsman with additional functions and powers.

The new Ombudsman will be a Commonwealth‑wide advocate for smaller enterprises, a single entry point agency for small business to access Australian Government small business programmes and support, a contributor to making Australian Government laws and regulations more small business friendly and a 'concierge' for dispute resolution.

This measure delivers on the Government's election commitment.

Further information can be found in the press release of 18 October 2013 issued by the Minister for Small Business.

Smaller Government — National Competition Council Secretariat — transfer

Expense ($m)
  2013-14 2014-15 2015-16 2016-17 2017-18
National Competition Council ‑0.8 ‑0.9 ‑0.9 ‑1.0

The Government will achieve savings of $3.6 million over four years by transferring the National Competition Council (NCC) Secretariat to the Australian Competition and Consumer Commission (ACCC).

The ACCC will provide secretariat support to the NCC Councillors and will establish appropriate safeguards to retain the independence of the NCC.

The savings from this measure will be redirected by the Government to repair the Budget and fund policy priorities.

See also the related expense measure titled Australian Competition and Consumer Commission — additional funding.

Taxation treatment of biodiesel — modification

Expense ($m)
  2013-14 2014-15 2015-16 2016-17 2017-18
Australian Taxation Office ‑52.0 ‑53.0 ‑51.0
Related revenue ($m)
Australian Taxation Office 0.3 0.3 0.3
Australian Customs and Border Protection Service ‑0.3 ‑0.3 ‑0.3
Total — Revenue

The Government will achieve net savings of $156.0 million over four years by reducing grants made under the Cleaner Fuels Grant Scheme to zero and reducing the excise on biodiesel to zero from 1 July 2015. From 1 July 2016, the excise rate for biodiesel will be increased for five years until it reaches 50 per cent of the energy content equivalent tax rate. The excise equivalent customs duty for imported biodiesel will continue to be taxed at the full energy content equivalent tax rate.

The savings from this measure will be redirected by the Government to repair the Budget and fund policy priorities.

See also the related expense measure titled Ethanol Production Grants Programmecessation in the Industry Portfolio.