Treasurer Wayne Swan released the Australian Labor Government’s first budget last night with a surplus of $21.7 billion and tax cuts worth $7.1 billion in 2008-09 and $33 billion over four years.

However, for businesses, employers, superannuation providers including trustees many of the implications of the budget can be found in the detail. Mercer has reviewed the budget and analysed what it might mean for these groups.

Do you know how the following issues will impact you and your business?

• Initiatives to improve the availability of a skilled workforce

• The introduction of a First Home Saver Account scheme

• Greater means-testing of Government support – income to include ‘salary sacrificed’ superannuation contributions

• Introduction of a superannuation clearing house facility

• Tightening of the Fringe Benefits Tax rules

• Significant increases in the thresholds at which the Medicare Levy Surcharge applies

• Changes to the tax treatment of employee share schemes

• Changes to the superannuation rules applicable to temporary residents

Read further detail on the particular implications of these issues for employers, employees, and superannuation providers in Mercer’s 2008 Federal Budget Review.

The Government also announced a major review of Australia’s future tax system to occur over the next 18 months. Mercer looks forward to participating in the discussion on this issue.

Low & middle income earners need more savings support

Mercer welcomed the tax cuts introduced in this budget, but believes tax cuts highlight the need to make Australia’s superannuation system fairer – by providing low and middle income earners with more financial support for their superannuation.    Read the full press release