Report on the Federal Budget Policy 2019-20 of Australia: Tax Analysis

This report provides a comprehensive analysis of the 2019-20 Australian Federal Budget, focusing on the tax policies outlined by the Federal Treasurer Josh Frydenberg. It examines the budget's objectives, including building a stronger economy and securing a better future for Australians through lower taxes, support for small and medium-sized businesses, and ensuring fair tax contributions. The report details the key stakeholders, including individuals, families, and businesses, and the specific initiatives aimed at supporting them, such as scholarships, healthcare funding, and measures for environmental sustainability and community safety. It explores the government's commitment to delivering a budget surplus and the potential economic risks. Furthermore, the report analyzes the legislative process for tax laws, the roles of tax consultancy firms, and the impact of tax policies on the Australian Tax Office (ATO), including its role in interpreting and applying tax laws and ensuring efficient implementation. References to relevant sources are included for further study. The report concludes with a detailed look at the implications of the budget on various aspects of the Australian economy and society.

Running Head: Federal Budget Policy 19-20 of Australia
Federal Budget Policy 19-20 of Australia
Name of the Student
Name of the University
Author Note

1Federal Budget Policy 19-20 of Australia
Table of Contents
Response to question 1-.............................................................................................................2
Response to question 2-.............................................................................................................2
Response to question 3-.............................................................................................................3
Response to question 4-.............................................................................................................4
Response to question 5...............................................................................................................5
References and Bibliography.....................................................................................................6

2Federal Budget Policy 19-20 of Australia
Response to question 1-
The Australian Federal Budget has been prepared for the financial year 2019-20 by
the Federal Treasurer Josh Frydenberg. This budget includes the estimation of revenue and
expenditure for the current financial year and it also sets out the fiscal and economic outlook
for Australia. The budget outlines the political as well as the social priorities and how the
government has planned for its achievement (Budget.gov.au. 2020). This tax policy is
significant because it has aimed for building a stronger economy and a better future for the
Australians by lowering the taxes for the working Australians and backing the small as well
as the medium-sized businesses. Further, it ensures that the tax payers pay fair share of taxes
and there is ample job opportunities for the Australians (Koutsogeorgopulou and Tuske
2015).
Response to question 2-
The key stakeholders of this tax policy include the individuals, families and
businesses. Therefore for them the government has taken the initiative of providing $93.7
million from the financial year 2019-20 till the next four years for providing scholarships to
the students for studying in university campus and for the training providers of vocational
training. It has also aimed at strengthening the healthcare system of Australia by increasing
the funding from $81.8 billion in 2019-20 to $89.5 billion in 2022-23. The government has
aimed to help the older Australians for them who has wished to stay at home for a longer
period of time with 10,000 and more home care packages. In order to have a sustainable
environment it has aimed to reduce the emissions by 26% by 2030 and it is investing
$3.5bilion in package of Climatic Solutions. The government has also aimed for having a
safer community by funding the local councils and community organisations for preventing
crime and it has also undertaken the initiative for protecting schools and religious institutions

3Federal Budget Policy 19-20 of Australia
which are facing religious and racial intolerance. The government has aimed for keeping the
families of the country safe and secured by addressing the violence against children and
women. Therefore, for this purpose it is providing $328 million over the next four years for
delivering the Fourth Action Plan under the National Plan for reducing the violence against
women and their children 2010-2022 (Budget.gov.au. 2020). Further, the government will
provide $528 million over the next five years for establishing a Royal Commission to
examine violence and exploitation and make recommendations accordingly. The government
has also taken further initiative for providing an additional amount of $30.5 million for
assisting legal assistance to those who are facing violence in family, senior citizens of
Australia and people with mental and physical disability. It has also aimed for improving the
wellbeing of the Australian veterans along with their families and for this the government is
providing easy and simple access for them in terms of services and treatments along with
providing improved care in complex situations. It has also taken an initiative for the purpose
of building the capability of national security and agencies of law enforcement for protecting
the Australians from domestic as well as international threats along with terrorism and violent
extremism. Therefore, for this purpose the government has provided $513 million for the
Australian Federal Police over the next five years for enhancing its counter terrorism
activities and community policing (Koutsogeorgopoulou and Tuske, 2015).
Response to question 3-
According to the government, the Federal Budget of 2019-20 is going to deliver a
surplus and satisfactory result for the first time in decades. The budget reinforces the
commitment of the government for investing in the future of Australia to strengthen the
economy and to provide guarantee for the essential services keeping the taxes low
(Treasury.gov.au., 2013). The economy of Australia is expected to stay in a good shape but

4Federal Budget Policy 19-20 of Australia
there are certain risks that the economy may face both domestically as well as internationally.
There is an underlying cash balance for the budget which has been forecasted to be in a
surplus of $7.1 billion which will help to build 1% of GDP in the medium term. The budget
has announced certain cornerstone policies in which the first is the plan of the government to
deliver lower taxes. This can be done by providing tax relief to low and middle income group
of Australia, providing lower taxes to the businesses of both small and medium sized with the
increase in the instant write-off of the assets and by safeguarding the integrity of the tax
system by ensuring that everyone along with the big businesses and multinationals pay the
fair share of taxes (Budget.gov.au., 2020). The budget has proposed another key feature
which includes that there will be increase in the spending of the infrastructure by $100 billion
over the next few decades. Similarly, the tax policy has benefitted the individuals and
families in various ways which include the strengthening of medical care by providing
affordable access to medicines and providing significant assistance to educational system and
the senior citizens of Australia. There are other measures too which are relevant to the private
capital industries like supporting if exports in Australia, investing social impact and
clarifying the operations of mismatch rules of the hybrid (Bartlett, 2015).
Response to question 4-
The ultimate power of making the tax laws rests on the hands of the Parliament and it
is necessary that a tax policy must be passed in the similar way by the Senate and the House
of Representatives for making it a law and later it is to be assented by the Governor- General
(Daley and Wood 2015). A tax consultancy firm can only consider a policy as a passed when
the bill gets passed from the House of Representatives according to section 53 of the
constitution of Australia (King 2016). Therefore, when a policy becomes law it creates
certain impacts on a tax firm along with its clients. These impacts are-

5Federal Budget Policy 19-20 of Australia
 As soon as the policy becomes law it is the responsibility of the tax firm to provide
necessary advices to the clients about the benefits of the law and how it is going to
impact the society.
 There are certain activities which the tax firm has to undertake and these activities are
forecasting of the provisions of the revenue and costing of the tax policies and other
consultation and legislative support to the clients.
 When a tax policy becomes a tax law then a tax firm has to change its entire policies
and practices and it has to undertake the new policies and practices in accordance with
the new tax law.
 It is the duty of the tax firm to disclose in details about the new tax law to its clients
and what changes they have to undertake for the occurrence of the change in the tax
law. The clients at the same time should gather in detailed knowledge about the new
tax law so that tax filing can be done easily by both the parties.
Response to question 5
It is to be assumed that after a policy becomes law it creates certain impacts on the
work policy of the Australian Tax Office (ATO). The central governance role of principal
revenue collection of the government is being played by the Australian Tax Office and the
administrator of tax and superannuation laws. Normally, the services are delivered to the
people at the levels of local, state, federal and government and the large proportion of taxes
are being collected by the Australian Tax Office (ATO) at the federal levels. The ATO is
responsible for the collection of about 95% of the revenue of the federal government and it is
engaged to serve about 10 million individual tax payers and almost 3 million of businesses
(Ato.gov.au. 2020). During the recent times, the Australian Tax Office has adopted a new
approach of design for the development of the systems of administration of taxes (Hobson

6Federal Budget Policy 19-20 of Australia
2019). The tax system of Australia is a fundamental part of the social and the economic
infrastructure of Australia (Braithwaite and Reinhart 2019). The Australian Tax Office play a
crucial role in the tax system when there is a change in the tax system and this role includes-
 It is the duty of ATO to interpret and apply the law
 It is the duty of ATO to analyze the purpose of the law, whether the law is clear
without any unintended consequences
 It is the duty of ATO to ensure that the new legislation has been implemented
efficiently and effectively after consulting with the general public.

7Federal Budget Policy 19-20 of Australia
References and Bibliography
Ato.gov.au., 2020. Latest news on tax law and policy. [online] Available at:
https://www.ato.gov.au/general/new-legislation/latest-news-on-tax-law-and-policy/
[Accessed 16 Jan. 2020].
Bartlett, A., 2015. 13. The 2013 Federal Election: The Greens campaign. Abbott’s gambit:
the 2013 Australian federal election, p.211.
Braithwaite, V. and Reinhart, M., 2019. The Taxpayers' Charter: Does the Australian Tax
Office comply and who benefits?. Centre for Tax System Integrity (CTSI), Research School
of Social Sciences, The Australian National University.
Budget.gov.au., 2020. Budget 2019-20. [online] Available at: https://www.budget.gov.au/
[Accessed 16 Jan. 2020].
Daley, J. and Wood, D., 2015. Fiscal challenges for Australia. Grattan Institute.
Hobson, K., 2019. 'Say no to the ATO': The cultural politics of protest against the Australian
Tax Office. Centre for Tax System Integrity (CTSI), Research School of Social Sciences, The
Australian National University.
King, D., 2016. Fiscal Tiers (Routledge Revivals): The Economics of Multi-Level
Government. Routledge.
Koutsogeorgopoulou, V. and Tuske, A., 2015. Federal-State Relations in Australia.
Koutsogeorgopulou, V. and Tuske, A., 2015. Federal-state relations in Australia. OECD
Economic Department Working Papers, (1198), p.0_1.
Lingard, B., 2016. Think Tanks,‘policy experts’ and ‘ideas for’education policy making in
Australia. The Australian Educational Researcher, 43(1), pp.15-33.

8Federal Budget Policy 19-20 of Australia
Murphy, K., 2019. Procedural justice and the Australian Taxation Office: A study of scheme
investors. Centre for Tax System Integrity (CTSI), Research School of Social Sciences, The
Australian National University.
Treasury.gov.au., 2013. Tax policy formulation in Australia | Treasury.gov.au. [online]
Available at: https://treasury.gov.au/publication/economic-roundup-issue-2-2013-2/
economic-roundup-issue-2-2013/tax-policy-formulation-in-australia [Accessed 16 Jan. 2020].