The federal government released the 2024-2025 Mid-Year Economic and Fiscal Outlook (MYEFO) on 18 December 2024. The 2024-25 MYEFO did not introduce any significant tax reforms, but outlined several noteworthy tax proposals.
The 2024–25 MYEFO continues the Government’s responsible approach. It improves the budget position for this financial year and makes structural improvements to the budget over the medium term. Fiscal policy settings remain consistent with inflation sustainably returning to the Reserve Bank of Australia’s (RBA) target band.
The Government has been able to deliver improvements to the budget despite challenging economic conditions and the need to fund unavoidable spending and payment variations, including automatic adjustments to demand-driven programmes. These factors are the primary drivers of the deterioration in the underlying cash balance over the forward estimates since the 2024–25 Budget.
Additional Australian Taxation Office (ATO) funding for modernizing tax administration systems
This MYEFO also includes measures to continue to improve the integrity and administration of the tax system, improving the budget by AUD 361.2 million over four years. This includes funding for the Australian Taxation Office to modernise tax administration systems and extend and enhance tax compliance activities focusing on illegal phoenix activity and the shadow economy, as well as strengthening the tax penalty system.
Penalties expansion
The Government is also committed to strengthening the Unit Pricing Code, including by introducing substantial penalties for supermarkets which breach the Unit Pricing Code. The Government will also introduce legislation to recalibrate penalties and charges, incentivising employers to promptly rectify missed payments, with more severe consequences for deliberate and repeated failures.
Tax incentives
The Government is boosting the supply of rental housing in Australia through tax incentives to encourage investment and construction in the build-to-rent sector. Build to Rent reforms will boost the supply of rental housing in Australia through tax incentives to encourage investment and construction in the build-to-rent sector.
Since the 2024–25 Budget, the Government has progressed the broad range of reforms that underpin the Future Made in Australia agenda. This has included legislating the Future Made in Australia Act 2024 and the Guarantee of Origin scheme, and introducing legislation for production tax incentives for critical minerals processing and renewable hydrogen.
Commercial broadcasting tax
The Government is investing AUD 335.6 million to support public interest journalism and media diversity in Australia. This includes funding for the News Media Assistance Program, community broadcasting, ongoing stable funding for the Australian Broadcasting Corporation and a 1-year suspension of the commercial broadcasting tax to provide relief to the commercial television and radio broadcasting sector.
News bargaining incentiveÂ
The Government will introduce the News Bargaining Incentive to support the sustainability of news and public interest journalism. The Incentive includes a charge and an offset mechanism to encourage large digital platforms to enter into or renew commercial deals.
