“Building on lower than expected COVID outlays, the Budget banks on economic growth to gradually restore depleted coffers whilst simultaneously boosting spending to address a range of pressing social issues,” said CA ANZ Tax Leader Michael Croker.

“Getting unemployment down to 4.75% by 2022-23 is this Budget’s main objective, a target which is also key to Reserve Bank deliberations on monetary policy.

“Budget objectives can apparently be achieved without resorting to major tax reform, with rosy Budget predictions including a stunning 4.25% GDP growth forecast for 2021-22.

“The absence of adverse tax changes is welcome relief for the many Chartered Accountants exhausted from COVID stimulus measure workloads piled on top of their business-as-usual work.

“The continuation of the low and middle income tax offset was an expected and necessary move to not only support Australians, but to avoid a taxpayer backlash.

“The main business tax change out of this Budget is the one-year extension to temporary full expensing of depreciating assets and tax loss carry-backs.

“This will be welcomed by businesses and accountants, although tax depreciation has in recent years become incredibly complex to navigate.

“The good news for the Government is that tax collections have held up remarkably well, thanks to improving employment conditions and profitable Australian extractive industries.

“Rather than acting to address worrying increased levels of tax debt mostly owed by small business, the Government has moved to pause ATO debt recovery actions but only in the rare circumstance where debt is being disputed in the AAT.

“Chartered Accountants will watch closely to see whether the millions to be spent on further ‘digitalisation of the economy’, including myGov, gives the ATO greater real-time line of sight over business operations and likely tax defaulters.

“On the international tax front, the take-up rate for the ATO new ‘concierge service’ for global investors will be interesting given the regulator’s keen appetite for detailed information on offshore structures and tax planning.”

Croker said that the Government has adopted a ‘steady as she goes’ approach as it navigates Australia through difficult times.

“With a Federal Election likely before another Budget is delivered, Mr Frydenberg’s speech had a distinct ‘out on the hustings’ tone, but difficult reform decisions have been postponed,” said Croker.