Australia introduces 30% minimum tax on discretionary trusts

Summarised from 2 outlets · 3 reports · Updated 18 Oct, 02:02 · Archive

Australia is introducing a 30 per cent minimum tax on discretionary trusts, with small businesses facing thousands of dollars in compliance costs.

Laws introducing a 30 per cent minimum tax on trusts were introduced to parliament on Wednesday, following the proposal in the May federal budget. The government has argued that the large number of discretionary trusts was subverting the tax system and placing a greater burden on workers. Business groups have opposed the reform, saying trusts are used legitimately to protect assets.

Assistant Treasurer Daniel Mulino said the reforms would better align taxes through trusts and labour income. He estimated there were about 800,000 discretionary trusts in Australia, with the number doubling over the past 25 years. When asked about the cost to businesses, he said it would be in the thousands of dollars, depending on the kind of restructuring pathway undertaken. The government estimates total economy-wide adjustment costs at about £50 million.

Labor will need the support of either the coalition or the Greens to pass the reforms through parliament. The coalition have come out strongly against the bill and are unlikely to support it.

How it is being reported

• Small businesses will pay thousands in upcoming trust tax changeA federal minister has admitted there will be a cost to pay for business owners in adjusting to rules taxing discretionary trusts.The West Australian · 18 Oct, 02:06
• Businesses set to fork out in upcoming trust tax changeA federal minister has admitted there will be a cost to pay for business owners in adjusting to rules taxing discretionary trusts.Perth Now · 18 Oct, 01:31
• Businesses set to fork out in upcoming trust tax changeA federal minister has admitted there will be a cost to pay for business owners in adjusting to rules taxing discretionary trusts.The West Australian · 18 Oct, 01:31

In this story: Australia · Daniel Mulino · Labor · Coalition · Greens

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